Morrisons to receive up to £50m from convenience store sell-off

Ashley Armstrong
05 Sep 2015
Retail Correspondent

Deal could see Morrisons convenience stores re-branded as My Local
Morrisons is expected to receive between £30m and £50m from the sale of its convenience stores, according to sources.
The supermarket’s management team is spending this weekend in intense negotiations with Greybull Capital, the investment firm which rescued Monarch Airlines last year; in an effort to seal a deal before it updates the City on a slump in profits on Thursday.
It is understood that retail veteran Mike Greene, who is fronting the bid for Greybull, is keen on rebranding the 150-strong chain as “My Local”. The stores currently trade as M Local.
Morrisons’ new chief executive, David Potts, is expected to report in his first interim results at the grocer that pre-tax profits have dropped to around £140.7m, from £239m last year. Revenues are also due to come in at around £8.1bn, a slight slip on the £8.5bn recorded last year. Analysts at Barclays expect the Bradford-based supermarket chain to post a 2.5pc fall in half-year like-for-like sales.
An “Every Penny Matters” label alerts customers to deals on a refrigerated display of ready prepared meals inside a Morrisons M Local store, operated by William Morrison Supermarkets Plc, in London, UK
Morrisons is expected to unveil a slump in interim profits Photo: Bloomberg
Mr Potts is expected to flesh out details of his plan to restore the group’s core supermarkets and go back to basics and away from the frivolities of his predecessor, Dalton Philips.
The grocer’s weakened share price has led it to be seen as a takeover target for the South African billionaire Christo Wiese, who told The Daily Telegraph last that he wasn’t ruling out adding an acquisition in the UK food sector after his recent takeovers of New Look and Virgin Active.
Morrisons will be joined in reporting results by a rash of retailers, including Home Retail Group, Dixons Carphone, Next, Dunelm and John Lewis Group.
Next, Dunelm and Dixons Carphone Warehouse are all expected to post a rise in full-year profits but investor enthusiasm is expected to be tempered by figures last week that showed that August was the worst month for high street shops since the financial crisis.
Sports Direct, which is under fire from shareholder bodies for corporate governance issues, also faces investors next week at its annual meeting.
All parties linked to Morrisons declined to comment.