McColl’s deal makes progress following Morrisons offer to sell 28 stores

An offer by Morrisons to sell 28 McColl’s stores has provisionally paved the way for the Competition and Markets Authority (CMA) to clear the deal between the two retail groups.

McColl’s was acquired by Morrisons in in May 2022, transferring around 16,000 staff and 1,100 shops and rescuing McColl’s two pension schemes which have more than 2,000 members.

A Phase 1 investigation identified 35 areas of concern with the deal, leading to the Morrisons offer to sell 28 McColl’s stores (full list below) to address competition concerns in the areas where those stores are located.

The CMA said it is “minded to accept these proposals, which appear to be suitable to restore the loss of competition brought about by the deal across each of the 35 local areas”. It added that while the number of McColl’s stores that Morrisons is proposing to sell is lower than the number of areas in which concerns were identified, the sale of some stores would address the concerns in multiple areas.

The CMA is now consulting on the proposals for the sale of these stores and if it accepts the proposals, the deal would be cleared to proceed.

Sorcha O’Carroll, CMA senior director of mergers, said: “Our preliminary view is that the sale of these stores will preserve competition in these local areas and prevent consumers from losing out due to this deal, at a time when shoppers are already facing rising prices.

“If, after reviewing the responses to our consultation, we conclude that the competition issues have been addressed, the deal will be cleared.”