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Morrisons set to outbid Asda’s owners to rescue McColls
UK supermarket Morrisons looks set to rescue beleaguered convenience store McColls from collapse, following an escalating battle with Asda’s owners, the Issa brothers, over the weekend.
Convenience retailer McColls, which operates around 1,100 stores across the UK announced its collapse on Friday, sparking a bidding war which rapidly developed over the weekend. It was reported that the company has racked up debts of £170million, leading it close to collapse, unless it could be sold to a new owner immediately, as a pre-pack deal.
Morrisons emerged an an early bidder – it has been a key supplier to McColl’s since 2017 and the two retailers have an agreement to convert hundreds of McColl’s shops to Morrisons Daily convenience stores. More than 200 have already been converting and are said to be performing well.
However Morrison’s early approaches were reportedly rejected and the EG Group, emerged as emerged as the favourite over the weekend, allegedly offering to repay McColls debts.
The petrol forecourt company is based in Blackburn and owns brands such as LEON, Cooplands and Euro Garages. The owners of EG Group, Mohsin and Zuber Issa, were part of a consortium that bought Asda in 2020 for £6.8 million, along with private equity firm TDR Capita.
Final tenders were submitted on Sunday night and although no formal announcement has been made, it is rumoured that the Morrisons deal is likely to go through.
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