Morrisons confirms McColl's rescue deal
Morrisons confirmed on Monday that it has agreed to buy convenience store operator McColl’s from the administrator, seeing off competition from the Issa brothers’ EG Group.
The supermarket retailer said the deal will be structured through a pre-pack administration. Morrisons will buy all of McColl’s 1,160 stores, which include 270 Morrisons Daily format stores.
All McColl’s staff will be transferred with the McColl’s business to Morrisons, and McColl’s two pension schemes will be taken on by the chain.
Morrisons - which was recently taken over by private equity firm Clayton, Dubilier & Rice - said its wholesale supply agreement to McColl’s stores will continue without interruption and the convenience stores will continue to trade.
Morrisons chief executive David Potts said: "Although we are disappointed that the business was put into administration, we believe this is a good outcome for McColl’s and all its stakeholders. This transaction offers stability and continuity for the McColl’s business and, in particular, a better outcome for its colleagues and pensioners.
"We all look forward to welcoming many new colleagues into the Morrisons business and to building on the proven strength of the Morrisons Daily format."
McColl's went into administration last Friday after talks with Morrisons fell through and creditors refused to extend a deadline for it to raise more cash.