Morrisons considers sale of Safeway c-stores
Information sent to potential buyers
Morrisons has effectively invited offers for 120 smaller Safeway stores after sending information packs to potential buyers.
The stores, acquired by Morrisons when it took over Safeway in March, have been trading under the Safeway Compact brand in a convenience format.
Morrisons’ decision to send details of the stores to retailers who expressed an interest during the drawn-out sale process suggest it has decided to focus solely on the larger stores, which are being converted to the Morrisons format.
Some industry observers have suggested that the decision to adapt Morrisons’ offer to a convenience format is a distraction at a time when the focus should be on the underperforming larger Safeway stores.
[img r]morrisonslogo.jpg[/img]A Morrisons spokesman told news agency Reuters: “At the time of the acquisition we said that 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.”
Potential buyers are likely to include Big Food Group, owner of Iceland, Waitrose, the Co-op, and Somerfield.
Tesco and Sainsbury’s, both of which have c-store formats, would probably be ruled out on competion grounds, while Morrisons would also be reluctant to do a deal which increased its rivals’ market share. Marks & Spencer had also expressed an interest in some of the Safeway store, However, the future of its food-only store formats seems less certain under new M&S chief executive Stuart Rose.
