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Morrisons announces £331m deal to sell and lease back store sites

Supermarket chain Morrisons is set to raise £331m through a sale-and-lease-back deal on 76 of its stores.

The Bradford-based firm said it expects to complete the “ground rent financing” deal around October 2, potentially allowing it to reduce its debt levels. The company buying the properties has not been disclosed but Sky News has reported that real estate investor Song Capital is the buyer.

The announcement has come ahead of a third quarter trading update from Morrisons, which was bought by US private equity firm Clayton, Dubilier & Rice in 2022 for £7bn. It is the fifth-largest supermarket chain in the UK.

The deal comes amid efforts by Morrisons to reduce its heavy debt pile, although the company said the way it will use the proceeds of the deal is “under consideration”. It most recently reported a debt burden of about £4bn, although this is down significantly from a peak of £6.2bn.

Debts were reduced by the proceeds of the £2.5bn sale of its petrol station business to Motor Fuel Group, the forecourt giant also owned by CD&R. It has also been pushing forward with a major cost-cutting programme under new boss Rami Baitieh.

Original artice – https://business-live.co.uk/all-about/yorkshire-humber

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