Morrisons mulls store sell-off
British supermarket group Morrisons is considering the sale of its smaller Safeway stores following strong interest from potential buyers, it emerged today.
The Bradford-based chain, which acquired the Safeway business earlier this year, pledged to look more closely at the future of the sites after being surprised at the amount of interest. Up to 120 stores could be involved.
The move would be on top of the 52 shops currently being sold by Morrisons as part of conditions imposed by competition authorities.
Morrisons said today: “At the time of the acquisition we said we were surprised by the significant levels of interest shown in the smaller stores.
“That level of interest has been maintained and we now plan to test its full extent in the market.”
The Big Food Group, the Co-op and Waitrose owner John Lewis – which has already bought some Safeway stores – are among chains likely to be in interested in the outlets, which are expected to be sold off in chunks.
It was reported today that Morrisons had already sent details of the sites - all under 15,000 square feet in size – to potential bidders.
Morrisons has already started the Safeway integration process by converting larger outlets to its own brand. However, recent industry figures highlighted the challenge facing Morrisons as Safeway sales have remained under pressure.
Executive chairman Sir Kenneth Morrison did offer shareholders some encouragement recently, however, as he said that sales at those stores already converted had been strong.
Around 50 of the larger Safeway stores are likely to be given the Morrisons brand by the end of this year – part of a three-year process to overhaul the former company’s 427-strong estate.
