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Last Updated: Monday, 6 June, 2005, 08:09 GMT 09:09 UK
Asda acquires 12 new stores in NI
Supermarket shopping basket
Rumours had persisted that Asda was to buy the NI stores
US-owned supermarket chain Asda has bought 12 former Safeway stores in Northern Ireland in a 73.6m deal.

Asda, owned by the world's largest retailer, Wal-Mart, is to make a 30m investment to refurbish the stores.

Bradford-based chain Morrisons had acquired the shops as part of its takeover of Safeway last year.

Asda plans to create 250 jobs by Christmas. Chief executive Andy Bond said it would bring "real competition" to the Northern Ireland grocery market.

Morrisons said the sale of its Northern Ireland stores was "in line with the company's strategy of concentrating on its mainland UK network".

Asda said the deal would enable it to introduce its low-cost clothing range to Northern Ireland for the first time.

Belfast - Shore Road
Belfast - Westwood
It said its prices in the new stores would be no higher than its stores in England, Wales and Scotland.

It said it would continue to work with all of Safeway's existing Northern Irish product suppliers.

Safeway and Morrisons had been big buyers of local produce, and Asda's head of agriculture and local sourcing Chris Brown said locally-sourced produce was an important part of their business.

Mr Brown said the deal was "a fantastic strategic investment for us".

"We looked at the numbers and we think we can reduce prices by about 6%, which at the current rate of sale is equivalent to 10m-worth of savings," he said.

BBC Northern Ireland business editor James Kerr said the takeover would "provide real food for thought for Tesco and Sainsbury", which until now had "not faced the aggressive cost-cutting for which Asda has a reputation".

The deal, which also includes four development agreements, needs to be cleared by the Office of Fair Trading.

Asda expects the conversion of all Safeway stores to take about three months once the transaction is completed, probably in September.

Morrisons' outlet in Downpatrick is not included in the deal, as a price could not be agreed which took account of construction work needed at the store.

Chain dismisses deal speculation
11 Feb 05 |  Northern Ireland
Morrisons sells 114 Safeway shops
25 Oct 04 |  Business
Morrison hands 14 stores to rival
14 May 04 |  Business
Morrisons seals Safeway takeover
08 Mar 04 |  Business
Store plans turned down
06 May 04 |  Northern Ireland

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