Asda co-owner Mohsin Issa has confirmed he will step down from running the supermarket.

He will hand over the reins to chairman Lord Stuart Rose and the management team.

Asda said Mohsin is set to leave his executive role this week, to concentrate on his recently announced move to become sole chief executive of the petrol station forecourts business, EG Group.

Mohsin will remain co-owner of the chain, alongside private equity backer TDR Capital, and a non-executive on the board.

It comes as debt-laden Asda continues its hunt for a chief executive to lead the firm, saying it will update “in due course”.

Lord Rose will take on Mr Issa’s executive responsibilities at Asda, alongside TDR partner Rob Hattrell and the supermarket’s existing management team.

Mr Issa said: “I have decided now is the right time for me to step back from my oversight role at Asda to focus on EG Group as sole chief executive.

“It is a very exciting time for EG Group, and I am looking forward to focusing on the business while supporting Stuart, Rob and the leadership team in my capacity as a shareholder of Asda.”

Lord Rose said: “We respect Mohsin’s decision to move on from his role at Asda where his work is complete to be the sole chief executive of EG Group.

“We are very grateful to Mohsin for the role he has played in overseeing Asda.”

In June, Mohsin’s brother, Zuber Issa, sold his stake in Asda to the supermarket chain’s private equity backer TDR Capital. It was also announced that Zuber would step down as co-CEO of EG Group.

Zuber and Mohsin Issa bought Asda from Walmart in 2020, in a £6.8billion deal with the backing of TDR Capital.

EG Group saw a surge in profits in the latest fiscal quarter of the year, according to a new report.

Earnings before interest, taxes, depreciation, and amortisation (EBITDA) rose by 12 per cent to £215 million in the second fiscal quarter (Q2), driven by strong performances in the USA and Europe.

Grocery and merchandise gross margin grew by 2.4 per cent and gross profit increased by six per cent to £256 million, driven by coffee and dispensed beverage initiatives in the USA.

Meanwhile, Asda’s performance has been lagging behind its peers and Lord Rose was recently reported saying he was “embarrassed” by its performance under his supervision, and believed Mohsin Issa should step back.

The UK’s third-largest supermarket chain revealed last month that its sales dropped further over the latest quarter as it lost more customers to its largest rivals.

It saw total revenues, excluding fuel, rise 2% for the first half of 2024, although like-for-like sales slipped by 2.1%.

Revenues in the second quarter of the year were down 2.2%, with a 5.3% like-for-like decline, as its sales slump accelerated.