Former London listing Wm Morrison Supermarkets has proposed an eleventh hour deal to save beleaguered convenience store chain McColl’s Retail Group PLC, Sky News reported on Friday.

McColl’s shares were 40% higher at 1.60 pence each in London on Friday morning.

Sky News said Morrisons tabled a proposal on Thursday. It was lodged with PricewaterhouseCoopers, an adviser to the convenience store operator’s lenders.

The deal would prevent McColl’s sliding into insolvency, an outcome it warned about on Thursday. McColl’s on Thursday said it was in discussions regarding potential financing solutions for the business to resolve short term funding issues. Should an outcome not be agreed, it cautioned it was ‘increasingly likely’ that the business will be placed into administration.

A rescue deal with Morrisons would see most of McColl’s Retail’s 16,000 strong workforce and its pension scheme protected.

The deal would not involve any meaningful value being attributed to McColl’s shares, Sky News added, citing people familiar with the matter.

There is also interest from EG Group, a petrol retailer owned by TDR Capital and the Issa brothers.

McColl’s already partners with Morrisons. McColl’s operates around 200 Morrisons Daily stores, smaller format sites belonging to the Bradford-based grocer chain.

On Tuesday, McColl’s said it would request a temporary suspension of its shares following a delay to the publication of its financial 2021 annual report. The company expects to request its listing to be temporarily suspended from June 1.

https://news.sky.com/story/morrisons-pitches-last-ditch-rescue-deal-for-ailing-convenience-retailer-mccolls-12606452

Private equity firm Clayton, Dubilier & Rice won an auction to acquire Morrisons back in October, for £7 billion.

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