Morrisons is said to be on the brink of offloading its convenience-store subsidiary, M Local.
Reports at the weekend indicated that investment group Greybull Capital is lining up a bid for the group's convenience business, however the retailer is yet to confirm or deny that this is the case.
Should the disposal be agreed, it would be a significant move for recently-appointed Morrisons CEO David Potts, who is seeking to turnaround the business.
Commenting on the reports, Ken Odeluga, a senior market analyst at www.cityindex.co.uk, said, "Morrisons is not obliged to specify how much it earns from its convenience store business and even if as its cash flow statements suggest, it makes a modest income from it, for the sake of focus and reallocated operating expenditure, there’s a fair argument to end the venture."
In addition, Shore Capital Stockbrokers, which tracks Morrisons stock, said that regardless of whether the rumors are true or not, it is "encouraging and important that David Potts, CEO, and his newly constituted senior team concentrate on the big issues, the big challenges and yet the major opportunities for the group.
"We have felt and continue to see these 'big matters' as turning around the performance of the group's c500 superstores and supermarkets."
© 2015 European Supermarket Magazine – your source for the latest retail news. Article by Peter Donnelly. To subscribe to ESM: The European Supermarket Magazine, click here.
