British supermarket group Morrisons has agreed to sell 337 petrol forecourts to Motor Fuel Group (MFG) in a £2.5-billion (€2.9 billion) deal.
Both Morrisons, the UK's fifth largest grocer, and MFG are owned by US private equity group Clayton, Dubilier & Rice (CD&R).
The deal will also see MFG acquire more than 400 associated sites across the UK for ultra-rapid electric vehicle (EV) charging development.
The two companies will form a strategic partnership, with Morrisons taking a stake of about 20% in MFG.
'The proposed transaction will create significant synergies across fuel retail and ancillary services, as well as scale advantages and growth opportunities for both businesses,' the companies said, adding the deal would be a significant creator of jobs.
CD&R paid £7 billion (€8.2 billion) for Morrisons in 2021, leaving it with a hefty debt burden.
Morrisons, which is scheduled to report 2022/2023 results on 31 January, has been losing UK grocery market share, ending 2023 with 8.8%, down 30 basis points on the year, according to researcher Kantar.
'Best Value For Customers'
Rami Baitiéh, CEO of Morrisons, explained, “As the needs of the customer continue to evolve, Morrisons and MFG’s partnership will see us combine our respective expertise and resources to deliver the best value for customers at the pump, in our convenience stores and in our supermarkets.
“It means Morrisons customers will continue to see a competitive and attractive forecourt offering, including expanded access to EV charging, while also benefitting from greater focus on investment in Morrisons’ core food business. We are delighted to have such a strong partner in MFG and look forward to the opportunities a combined MFG and Morrisons forecourt offering will provide.”
As part of the transaction, Morrisons will continue to supply food and groceries across the 337 Morrisons petrol forecourts and explore the opportunity to supply to the MFG estate over the medium term.
In October, Asda, Britain's third biggest supermarket group, completed the acquisition of the majority of petrol forecourt operator EG Group’s UK & Ireland business for an enterprise value of 2.1 billion pounds.
News by Reuters, additional reporting by ESM.
