Morrisons agrees to sell forecourts arm in £2.5bn tie-up

Morrisons agrees to sell forecourts arm in £2.5bn tie-up
Sign outside a Morrisons petrol stationGetty Images

Morrisons supermarket has agreed a £2.5bn deal to sell its 337 petrol forecourts to Motor Fuel Group (MFG) as part of a new tie-up.

Both firms are owned by the US private equity group Clayton, Dubilier & Rice.

As part of the deal, MFG will also take on hundreds of Morrisons’ electric vehicle (EV) charging sites.

Morrisons said the partnership would mean better access to charge points for drivers and more cash plugged into the food side of the business.

The supermarket said the proposed deal would also see it take a minority stake of about 20% in MFG.

As part of the agreement, MFG is set to take on the Morrisons forecourts – including the fuel and retail operations – as well as more than 400 EV charging sites.

In a statement on Tuesday, the companies said that Morrisons would still supply food and groceries across the forecourts and its name would remain above the door.

As MFG operates a slightly different model to Morrisons, where staff are employed by a franchise holder, employees will be given a new position on the same pay and employment terms, they said.

“In nearly all circumstances, this position will most likely be in the store to which the forecourt is attached.”

They added that there will be no compulsory redundancies.

Upping investment

The companies pledged in their statement that “value-for-money supermarket fuel will remain the offering on Morrisons forecourts”.

They also outlined plans for investment in more EV charging points, as well as the offer in the forecourts around food-to-go and valeting services.

Rami Baitiéh, chief executive of Morrisons, said: “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 benefiting from greater focus on investment in Morrisons’ core food business.”

MFG – which has 900 sites in the UK – has said it wants to roll out 800 ultra-rapid EV chargers across the UK estate within the first five years after the deal.

Under the deal it would become one of the biggest EV charge point providers in the UK with some 1,300 in total.

It mirrors a similar agreement by supermarket rival Asda last year, where it agreed to take on EG Group’s petrol stations in the UK and Ireland.

William Bannister, the boss of MFG, said this deal with Morrisons was “anchored in the potential for us to accelerate the rollout of ultra-rapid EV charging infrastructure across the UK”.

“We will be there to serve and power our customers, regardless of what car they drive in the years and decades ahead as we play a key role in keeping the country and its economy moving,” he said.

Recent analysis from the RAC suggested that a target for the number of high-powered electric vehicle charge points near motorways had been missed.

Under its net-zero plans, the government wanted every motorway service station in England to have at least six rapid or ultra-rapid chargers by the end of 2023.

But data from the motoring organisation showed that only four in 10 meet this criteria, with experts calling for the planning system to be simplified to boost the construction of new charging centres.

Source: bbc.co.uk

By David Ryckman