The Issa brothers are scaling back investments in their gas station empire as they try to pay off debt.

In a joint statement, Mohsin and Zuber Issa said they 'strengthened' EG Balance Sheet Photo: John Super

The billionaire Issa brothers cut investment in their gas station empire as they try to pay off debt.

EG Group, the gas station business owned by Mohsin and Zuber Issa last year spent 37% less on growth investments in what executives described as a «controlled cut» to maximize liquidity.

The Blackburn-owned company, which controls thousands of petrol stations around the world, spent $243m (£191m sterling) for growth in 2023. It doesn't explicitly say where capital spending cuts have been made, but the company has invested heavily in 2022 to expand in the US. .

In contrast, EG Group said US boss John Carey expanded its operations last year «with minimal capital expenditure».

The cuts come as EG seeks to reduce its debt pile. high interest rates. The company has been selling off assets to pay down debt and has cut borrowing from $10 billion at the start of 2023 to $6 billion by the end of the year.

In a joint statement, Mohsin and Zuber Issa said they had «strengthened» EG's balance sheet. The couple said they intend to further reduce debt.

It comes amid scrutiny of the high levels of debt in the Issa brothers' business.

EG's debt levels have become intertwined. with Asda, which is also owned by Issa. EG sold most of its UK and Ireland business to the supermarket chain last year for $2.5bn (£2bn). Asda's debt is around £4.2bn.

Rising interest rates have increased debt servicing costs for both Asda and EG. The gas station operator did not provide full reporting but said underlying earnings, minus things like interest, investment costs, taxes and asset depreciation, fell 7% to $1.1 billion in 2023.

EG is looking to offload other parts of its vast empire to pay off a mountain of debt. The company sold its chain of 218 KFC franchises in December last year.

MPs have raised questions about the complexity of the Issa brothers' empire, and Mohsin Issa has been criticized by members of Parliament's business select committee for seemingly evasive answers in performance time.

MPs have questioned whether Asda's high debt levels have prevented Asda from cutting prices for customers, but the company's management denies this.

Asda is losing ground in the battle for customers. . Latest figures from research firm Kantar show the supermarket is lagging behind all its main rivals in terms of sales growth. Its share in the grocery market fell from 14.3% a year ago to 13.8%.