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Network Journal 2004 Issue 1 |
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Merged Morrisons set to join big retail players
The £3 billion merger of Morrisons and Safeway won the approval of 99 per cent of the shareholders at extraordinary meetings, held by both companies in February, clearing the way for the launch of the combined group on 8 March.
Most of the Safeway stores will be rebranded under the Morrisons' fascia. The new group will operate 552 stores and have £13 billion of annual sales. It will be the UK's fourth biggest national supermarket group.
Morrisons will enjoy around 15.3 per cent market share compared to Sainsbury's 16.5, Asda/Wal-Mart's 17.1, and Tesco's 27.2. The new group will be the dominant force in the north, the west Midlands, Yorkshire and Humberside and Scotland.
The deal is expected to get the high court's approval in late February early March. Retail commentators anticipate a supermarket price war once the deal is complete, as Morrisons seeks to win customers from its rivals. Safeway has been losing market share since Morrisons first launched its takeover bid in January of last year.
Completion of the 14 month-long takeover battle will bring to an end one of the most protracted struggles in the history of the modern supermarket sector.
Hundreds of jobs will go at Safeway's head office, while the Bradford headquarters of Morrisons will take on extra staff.
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