Beer and burger tycoon Michael Cannon has bought Morrells Brewery for £48m.

It will still mean the closure of the historic Oxford brewery, but the new owners hope to keep "the vast majority" of the 77 Morrells staff in work.

Morrells beers will now be produced on a contract basis outside Oxford, ending two centuries of brewing in the city.

Cannon, an ex-Berni Inn chef, made a £120m fortune buying and selling pub chains. But news of his swoop in the face of competition from the likes of Greene King and Morland is unlikely to put an immediate end to months of uncertainty.

Cannon is now the majority shareholder in a newly created company, Morrells of Oxford, with the Morrells name surviving the end of the famous family firm amid bitter feuding. The new chief executive Paul Beadle immediately ruled out any quick sell-off of the 132 Morrells pubs.

Mr Beadle said: "We see this as the foundation stone for us to build on. We are very pleased to have secured this quality business and we plan to pursue a programme of substantial investment within the pub estate."

The jobs of draymen should all be saved with the new owners determined to expand the free trade delivery side of the business.

Mr Beadle said it was simply not viable to keep the small Lion Brewery in St Thomas Street open.

"If we could have kept the brewery going, we would have kept it going," he said. "But we do wish to maintain the Morrells brand. "There will be some redundancies. We are now in consultation with staff but it is too early to go into numbers."

He hoped as many brewery workers as possible could be transferred to other jobs following the closure of Oxford's only brewery.

The firm will consider opening a micro-brewery to supply a small number of pubs. The major brewery producing Morrells on contract is not yet known.

There was a mixed response from brewery workers and staff at the Morrells distribution centre in Osney Mead.

One Morrells worker said: "We were told we are keeping our jobs. The question now is for how long.

"We are angry that the Morrells family are leaving with millions but people who worked here for more than 20 years are getting nothing." But pub tenant Anne Power, of The George in Botley, said: "It is good news that many of the Morrells workers jobs are to be saved.

"We look forward to working with the new owners. It's a new firm and hopefully they will be able to put some money into the pubs."

Mike Benner, of the real ale group Camra, said: "This new company appears to have no plans to keep the brewery open but is promising substantial investment in the pubs and the retention of some Morrells beer brands.

"But Morrells beers brewed away from the St Thomas Street brewery are likely to change beyond recognition. "

The new firm stands to make millions from the sale of the city centre site. Nuffield College has already confirmed an interest in it. Fortune made from buying pubs

The man who snapped up Oxford's most traditional family business is a self-made millionaire who bought his first pub for £10,000 at the age of 26.

The former Berni Inn chef went on to amass a £120m fortune, recently buying a US burger chain for £26.4m.

Mr Cannon, 59, has shown a genius for buying and selling pub chains. He bought his first pub in Bristol in 1976 and within ten years had a chain of 40.

He made his first fortune when he set up Davenish, a pub chain he sold to Greenalls for £26m in 1993.

Real ale fan Mr Cannon then moved on to become chairman of the Magic Pub Company, setting up the 227 bar chain with a £12m investment in 1994, before selling it .

But he muliplied his cash when rivals Greene King, who he beat in the battle for Morrells, snapped it up for £197m.

He is now a US resident, after acquiring the American hamburger restaurant group Fuddruckers and starting a New York property firm.

Mr Cannon said: " I have a low boredom threshold. It is almost like where you don't want to hang up your guns yet. I don't feel too old yet."

One thing is for sure. There is going to be nothing very traditional about Morrells of Oxford from now on.

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