CMA gives Morrisons green light for McColl’s takeover

Morrisons’ takeover of McColl’s is nearing completion after the Competition Markets Authority (CMA) announced it will accept the merger.

The takeover deal will see the supermarket acquire 28 stores from McColl’s existing estate, which the watchdog has decided not to investigate further.

The CMA said that Morrisons must “act in good faith” and inform the watchdog of the identity of each proposed purchaser that makes an offer, as well as the terms, “as soon as reasonably practicable”.

Morrisons must also use “reasonable endeavours” to ensure the transfer of key staff with the divestment of the Divestment Sites.

Additionally, for a period of 10 years following the divestment of the Divestment Sites, Morrisons is unable to hold, acquire, re-acquire or use an interest in the sites other than any freehold interest in the property, directly or indirectly, except with the written consent of the CMA.

No employee or director of Morrisons can carry on or have control of the sites without the CMA’s prior written consent, and can’t participate in the formulation of or influence the policy of the sites, other than in the ordinary course of business.

The green light takes the supermarket one step closer to signing off the £190m rescue bid it launched to save McColl’s after it fell into administration, putting 16,000 jobs and 1,100 stores at risk.

The investigation was initially launched in July 2022 as the CMA believed that the merger could result in a “substantial” lessening of competition within the UK for goods or services.

David Potts, Morrisons Chief Executive, told Retail Sector: “I am pleased that the acquisition of McColl’s has cleared the final regulatory hurdle. McColl’s is a business with great potential and over the last few months we have been making plans for its integration into Morrisons, for investment and for growth. We will be outlining these plans shortly.”