Morrisons has rescued convenience chain McColl’s – saving 16,000 jobs and stopping 1,100 stores across Britain from closing, according to Sky News.
McColl’s Retail Group fell into administration on Friday, threatening its 1,100 stores and putting the jobs of some 16,000 employees at risk.
The store chain has shops in Carlton Hill and Calverton.
According to Sky News, the new offer from the supermarket giant will see McColl’s stores and workforce preserved in their entirety.
The pre-pack administration deal will see Morrisons buying McColl’s immediately after it enters insolvency proceedings, which are being overseen by PricewaterhouseCoopers (PWC).
Morrisons and forecourt giant EG Group – run by Adsa owners the Issa brothers – were both in the running to complete a rescue deal for McColl’s.
While Morrisons’ early approach had been rejected by lenders, it is understood that both businesses put forward improved offers prior to the administrators’ Sunday 6pm deadline.
McColl’s lenders – which include Barclays, HSBC and the state-backed NatWest Group – initially preferred the proposal from EG Group, which had said it would instantly repay McColl’s debt of more than £160m.
However, an improved offer from Morrisons would see McColl’s lenders repaid immediately in full, satisfying their principal demand, was key to the grocer’s winning bid. Morrisons’ position as a major creditor is also likely to have been influential in the decision-making process.
McColl’s is an important partner of Morrisons, operating hundreds of smaller shops under the Morrisons Daily brand.
Morrisons’ commitments to the future of McColl’s also include retaining all 1,100 stores and 16,000 workers, as well as honouring all of its outstanding pension obligations.
A full announcement is expected to be made by PwC later on today.
