By Ben Dummett and Sarah Nassauer

Walmart Inc. has agreed to sell its U.K. grocery-store chain Asda Group Ltd. to a private investment group in a deal that values the company at 6.8 billion pounds, equivalent to $8.8 billion, as the world's largest retailer reorganizes its international businesses in favor of bets on the growth of online services.

The retail giant is selling a majority of Asda to TDR Capital, a European-focused buyout firm, and U.K.-based entrepreneur brothers Mohsin and Zuber Issa. The deal marks the end to a monthslong process that was temporarily interrupted this summer to meet surging demand for food basics in the U.S. amid the pandemic-triggered lockdown.

Based on the current deal terms, Walmart expects to recognize a non-cash loss of approximately $2.5 billion, after tax, in fiscal 2021, the company said in a filing Friday. The deal is expected to close in the first half of the next fiscal year, the company said. The sale will reduce Walmart's earnings per share by $0.25 in the first full year following the deal's close, the company added.

Walmart had previously tried to sell Asda to U.K. rival J. Sainsbury PLC. The country's competition watchdog, however, blocked that proposal over concerns the tie-up would reduce competition and potentially spur higher prices for shoppers.

Write to Ben Dummett at ben.dummett@wsj.com and Sarah Nassauer at sarah.nassauer@wsj.com

Corrections & Amlifications

This was corrected at 7:27 a.m. ET because the original version incorrectly said in the headline and the first paragraph that the value of the deal was 6.8 billion pounds. Walmart Inc. has agreed to sell its U.K. grocery-store chain Asda Group Ltd. to a private investment group in a deal that values the company at 6.8 billion pounds, equivalent to $8.8 billion.

(END) Dow Jones Newswires

10-02-20 0654ET