McColl's rescued by Morrisons but community is concerned

Supermarket giant Morrisons secured a bid to rescue the group of corner shops which fell into administration on Friday, prompting relief from clients.

The deal will save 16,000 jobs nationwide and most of its 1,100 stores, Morrisons said.

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There are branches in Blackbird Leys in Oxford, and in Botley, Carterton, Bicester, Faringdon and Didcot.

Steven Howkins, 76, is a customer at the Balfour Road, Blackbird Leys store and described it as a lifeline, adding: "This shop is like family to me, I come here every day at around 6am.

"If it goes, there's not another one in the area since the post office closed down so we would have had to go 20 minutes to the next one. It would have been a big inconvenience.

"Everyone you speak to was talking about what's going to happen, and we were really worried.

"This shop is my life. Everything seems to be closing at the moment."

Customers in Botley petitioned to save their local McColl's corner shop on Facebook.

The owner of the store was not able to comment but received many messages of support from shoppers on the Botley Noticeboard Facebook group.

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McColls in Botley.

North Hinksey councillor Judy Roberts said: "We were all concerned as we really value every single business in Botley as we're trying to build it back up. We can't lose another shop.

"We've been without shops for so long, and we have quite a lot of elderly residents in the area so those people can't go a long way to the shops.

"For them, local shops are really vital when they need to go and pick essentials like milk or bread up quickly.

"Also, I'm sure the local kids who go there after school to get sweets would have been really disappointed if it had closed."

Bosses last night said McColl’s staff would keep their jobs as the firm’s shops transfer to the new owner, while Morrisons will take over the company’s two pension schemes.

EG – whose owners also run supermarket giant Asda – had initially been favourites to complete a rescue deal for McColl’s.

Morrisons’ early approaches had reportedly been rejected by lenders who preferred EG’s offer to instantly repay more than £160 million in debts from McColl’s.

However, it is understood that Morrisons’ successful move will also repay the lenders in cash.

In a statement after the deal was announced, it said that “the secured lenders and preferential creditors will be paid in full with a distribution also expected to unsecured creditors”.

Morrisons had also originally proposed to only save the “vast majority” of job and stores, but improved this offer during the bidding process.

“All McColl’s colleagues will be transferred with the McColl’s business to Morrisons,” the supermarket said.

Morrisons chief executive David Potts said: “Although we are disappointed that the business was put into administration, we believe this is a good outcome for McColl’s and all its stakeholders.

"This transaction offers stability and continuity for the McColl’s business and, in particular, a better outcome for its colleagues and pensioners.

“We all look forward to welcoming many new colleagues into the Morrisons business and to building on the proven strength of the Morrisons Daily format.”

A spokesperson for the McColl’s Pension Schemes said: “The trustees welcome the announcement that Morrisons will continue to support the schemes following its acquisition of the McColl’s business.

“The trustees will continue to engage with all stakeholders to ensure that members’ benefits are protected following the completion of the transaction.”

McColl’s filed a notice to appoint administrators from PwC on Friday and formally entered administration on Monday.

McColl’s also runs around 270 stores under the Morrisons Daily brand.

It is understood that administrators were favourable to deal with Morrisons because the Bradford-based supermarket was one of McColl’s biggest creditors.

The deal comes less than a year after Morrisons itself was bought for £7 billion by US private equity company Clayton, Dubilier & Rice (CD&R).

McColl’s collapse has come after a financial struggle over the past two years as it witnessed soaring costs due to supply chain disruption, inflation and its large debt burden.

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