Morrisons and EG Group launch final bids for collapsed retailer with 11 Wigan outlets
Morrisons and EG Group have both tabled final offers to secure a rescue deal for collapsed retailer McColl’s.
The convenience chain fell into administration on Friday, plunging the future of its 1,100 shops and 16,000 staff into doubt.
The chain has 11 branches in Wigan borough, some of which were opened six years ago when McColl’s took over a number of Co-op outlets.
There are also several more in neighbouring towns and villages including Bolton and Parbold and together they employ scores of staff.
Forecourt giant EG – whose billionaire owners the Issa Brothers also run supermarket giant Asda – had been favourites to complete a rescue deal for McColl’s.
However, it is understood that both EG and Morrisons both tabled late improved offers prior to the administrators’ Sunday 6pm deadline for offers.
It is understood that EG has bowed to pressure to look after McColl’s pension liabilities, in a move that means that its 2,000 members will avoid a cut of up to 20 per cent to their promised pensions over their lifetimes.
Trustees for the McColl’s pension schemes have called on the Business Secretary Kwasi Kwarteng to do whatever he can to ensure pension scheme members are well protected.
Morrisons’ early approaches had reportedly been rejected by lenders who preferred EG’s offer to instantly repay more than £160m in debts from McColl’s.
It is believed that Morrisons has now said it will also repay the lenders in cash.
McColl’s filed a notice for administration on Friday and is now expected to formally enter administration today (Monday May 9) before a pre-pack deal is completed.
It is understood that EG group has proposed to retain the retailer’s stores and staff, promising to increase the lowest rate of McColl’s staff to £10.05.
However, it is predicted that any sale to EG could result in short term disruption to supply for McColl’s stores.
Morrisons is currently McColl’s wholesale supply partner and is expected to immediately terminate its deal with the convenience chain if their takeover move is unsuccessful.
Shares in McColl’s were suspended last week after the company delayed the publication of its latest financial results due to its financing talks.