AN announcement was made on September 9 advising that Morrisons would sell its loss-making M chain of 140 local convenience stores for a sum in the region of £25 million (€34 million) to a company funded by Greybull Capital.
The purchase will be led by Mike Greene who is a former chairman of the Association of Convenience Stores and founder of the Association of News Retailing. He is associated as chairman or director of several companies and has good knowledge of convenience stores.
Not only are all staff affected expected to keep their jobs, there is the intention to reopen stores that are currently closed creating a further 200 jobs.
Primarily a northern based chain, Morrison has made its presence felt by opening many supermarkets in the south and by sponsoring ‘Britain’s Got Talent’ although it has just dropped Ant and Dec as the TV faces of the company and is planning a new celebrity driven campaign.
The move into local convenience stores, mainly in the south of England seemed to be a good way of improving the company’s position but critics suggest that buying 49 properties previously owned by Blockbusters was not a sensible move as the stores were not necessarily in areas of high footfall. Other supermarkets have had considerable more success with their convenience stores but Morrisons just couldn’t emulate them.
Having announced a loss before tax of £792 million (€1.07 billion) earlier this year, the company needed to review its position and even selling these stores at a loss estimated at £30 million (€41 million) has pleased the market as they were considered to be a drain on resources which diverted management from other more important tasks.
The group has also announced that it will close 11 supermarkets with a possible loss of 900 jobs as part of its recovery plan.
Despite the current difficulties, those who live near Gibraltar are able to see for themselves how very popular that branch of Morrisons is and it is reputed to enjoy one of the highest turnovers in the group.