Morrisons has beat EG Group to the punch by agreeing to acquire McColl’s and its 1,160 convenience stores, which include 270 Morrisons Daily format stores.
First initiated by McColl’s lenders last Friday, the company was yesterday put into administration by PwC.
As part of the buyout, Morrisons will absorb the chain’s £170 million debt and its 16,000 staff members and 2,000 pensions scheme members.
Prior to the agreement of the deal, the supermarket saw an initial bid rejected, with Issa brothers owned EG Group looking likely to win the right to purchase. However, Morrisons managed to secure the transaction in a so-called last minute bid.
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As a result the McColl’s stores will continue to trade and secured lenders and preferential creditors will be paid in full with a distribution also expected to be given to unsecured creditors.
“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, Morrisons chief executive David Potts said.
“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.”
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