The deal, expected to complete in September 2026, covers five facilities in England and one in Northern Ireland that serve some of the UK’s largest supermarket chains, including Asda, Sainsbury’s and the Co-op. Financial terms of the transaction were not disclosed.

The warehouses provide ambient, chilled, frozen and bonded storage, handling around 46,000 different grocery products destined for supermarkets, convenience stores and neighbourhood retailers across the UK. GXO will continue to operate transport services linked to the sites where applicable.

The acquisition forms part of DP World’s strategy to build an integrated, end-to-end logistics platform spanning ports, freight forwarding, warehousing, distribution and inland transport across the United Kingdom and Europe.

Angela Howard, Vice President of Contract Logistics, North Europe at DP World, said the transaction would strengthen the company’s presence in key retail and consumer markets while expanding its geographic reach.

“We are delighted to welcome these six sites and the talented teams who operate them into DP World. They support some of the UK’s best-known grocery retailers and play a vital role in keeping products moving efficiently through complex supply chains every day,” she said.

“For our customers, it will be business as usual, backed by the strength, scale and investment of a global logistics business. By adding these operations to our network, we are expanding our ability to provide seamless supply chain solutions that connect ports, transport, warehousing and distribution through a single, integrated platform. This is an important step in our ambition to build a truly end-to-end logistics offering across the UK and Europe. It strengthens our presence in key retail and consumer markets, broadens our geographic reach and further enhances our ability to create value for customers,” the senior official remarked further.

The transfer is a result of regulatory requirements set by the UK’s Competition and Markets Authority (CMA) during its examination of GXO’s acquisition of the logistics firm Wincanton. The regulator concluded that combining the two businesses could reduce competition in outsourced grocery warehousing and required the divestment of Wincanton’s grocery logistics operations as a condition for approving the takeover.

For DP World, the acquisition further broadens its UK footprint beyond its flagship container terminals at London Gateway and Southampton. The company has been investing heavily in expanding its logistics capabilities as it seeks to capture a larger share of customers’ supply chains rather than relying solely on port operations.

The agreement is the second perishable logistics investment announced by DP World in the first weke of August. The company has also committed to developing a new temperature-controlled logistics centre at the Port of Antwerp in Belgium, a project expected to attract long-term investment of around 100 million euro.

DP World is also developing an automated grocery distribution centre for Tesco at London Gateway, due to open in 2029, reinforcing its ambition to become a leading integrated logistics provider serving retailers across the UK and Europe.

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The problem’s severity was exposed after the private equity-backed British supermarket chain confessed to Scottish parliament members that its external payroll agency had made roughly 11,000 errors in previous months, affecting the earnings of 5,500 employees.

Local press reports in Scotland have addressed the issue, including one in the Falkirk Herald that stated personnel at the town’s supermarket were using food banks and payday lenders due to pay discrepancies.

Supermarket employees informed the GMB union that they were becoming increasingly frantic because their monthly paychecks may be short £100 to £500. Others complained that companies clawed back overpayments the next month, resulting in a reduction in compensation.

Because of the mistakes, employees were “dreading” payday rather than looking forward to it, informing the union that they were skipping meals, going to food banks, and taking on debt when their paychecks were low. Others had missed bill payments, which harmed their credit score.

“Paying employees for the work they do is an utterly basic responsibility of employers,” said Nadine Houghton, GMB national officer of the firm, which was purchased last year by fuel depot barons Mohsin and Zuber Issa and TDR Capital.

“Asda is aware of the issue’s magnitude, but is unwilling to invest the necessary funds in the payroll operation to address it.”

“The stories we’ve heard from our members are terrible,” Houghton continued. “During a cost-of-living crisis, low-wage workers must be able to rely on their employer to maintain a degree of decency that ensures they get paid properly for the work they accomplish.”

The company’s written response to multiple MSPs who addressed the matter detailed the number of employees affected by payroll issues. Asda responded that their payroll contractor, SD Worx, had committed 10,806 errors affecting 5,529 employees.

“It is critical that our staff are paid accurately and on time, and we are sorry that it hasn’t been the experience for a few of them,” an Asda spokeswoman said.

“As soon as we became aware of the problem, we took steps to ensure that no one was left out of pocket.” We are collaborating with our payroll provider and have offered additional support to retailers to guarantee that this does not happen again.”

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 The Combined Business will create a dynamic new player in UK retail with an outstanding breadth of products, delivered through multiple channels. Enhanced scale and a strengthened balance sheet will deliver a great deal for customers, colleagues, suppliers and shareholders of both businesses. The retail sector is going through significant and rapid change, as customer shopping habits continue to evolve. This has led to increased competition across grocery, general merchandise and clothing, as customers seek ever greater value, choice and convenience. Bringing Sainsbury’s and Asda together will result in a more competitive and more resilient business that will be better able to invest in price, quality, range and the technology to create more flexible ways for customers to shop.

The Combination will result in Walmart holding 42% of the issued share capital of the Combined Business and receiving £2.975bn of cash, valuing Asda at approximately £7.3bn on a debt-free, cash-free and pension-free basis. At the time of completion of the Combination, Walmart will not hold more than 29.9% of the total voting rights in the Combined Business.

David Tyler, chairman of Sainsbury’s, said: “We believe that the combination of Sainsbury’s and Asda will create substantial value for our shareholders and will be excellent news for our customers and our colleagues. As one of the largest employers in the country, the combined business will become an even greater contributor to the British economy. The proposal will bring together two of the most experienced and talented management teams in retail at a time when the industry is undergoing rapid change. We welcome Walmart as a significant shareholder and look forward to working closely with them.”

Mike Coupe, chief executive officer of Sainsbury’s, said: “This is a transformational opportunity to create a new force in UK retail, which will be more competitive and give customers more of what they want now and in the future. It will create a business that is more dynamic, more adaptable, more resilient and an even bigger contributor to the UK economy. Having worked at Asda before Sainsbury’s, I understand the culture and the businesses well and believe they are the best possible fit. This creates a great deal for customers, colleagues, suppliers and shareholders and I am excited about the opportunities ahead and what we can achieve together.”

Judith McKenna, president and chief executive officer of Walmart International, said: “This proposed merger represents a unique and bold opportunity, consistent with our strategy of looking for new ways to drive international growth. Asda became part of Walmart nearly 20 years ago, and it is a great business and an important part of our portfolio, acting as a source of best practices, new ideas and talent for Walmart businesses around the world. We believe this combination will create a dynamic new retail player better positioned for even more success in a fast-changing and competitive UK market. It will unlock value for both customers and shareholders, but, at the same time, it’s the colleagues at Asda who make the difference, and this merger will provide them with broader opportunities within the retail group.  We are very much looking forward to working closely with Sainsbury’s to deliver the benefits of the combined business.”

Roger Burnley, chief executive officer of Asda, said: “The combination of Asda and Sainsbury’s into a single retailing group will be great news for Asda customers, allowing us to deliver even lower prices in store and even greater choice. Asda will continue to be Asda, but by coming together with Sainsbury’s, supported by Walmart, we can further accelerate our existing strategy and make our offer even more compelling and competitive.

From my six years with Asda and ten years with Sainsbury’s, I know first hand that both organisations are fortunate to employ some of the most talented and customer-focused colleagues in this market and I am excited by the opportunity of the two coming together.”

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