// Morrisons reveals £1.5bn loss after being bought by US private equity firm CD&R
// The grocer was acquired by CD&R in October 2021 for £7 billion in exchange for private equity
Morrisons has racked up £1.5 billion of losses, a year after being bought by US private equity firm CD&R.
The grocer was acquired by CD&R in October 2021 for £7 billion, in a debt-fuelled deal led by former Tesco boss Sir Terry Leahy.
The deal saw £6.1 billion of debt piled onto Morrisons’ balance sheet, resulting in large interest payments and high exposure to increases in borrowing rates.
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The current loss of £1.5bn, posted on Companies House, also accounts for £400m cost that the business took as interest payments.
The year before being taken over, Morrisons was the UK’s fourth-biggest supermarket and reported a £201 million annual profit. Last year it was leapfrogged by Aldi, booting it out of grocery’s Big 4.
Last week, the Bradford-based grocer put over 1,000 jobs at risk with its plans to ditch at least 83 property maintenance suppliers.
The grocer is looking to shift to a single provider for repairs as it ditches suppliers.
Morrisons is also likely to lay off up to 50 staff dealing with property maintenance at its Bradford head office and around the UK.
There you go. And see how many others have vanished thanks to PE
well this is what private equity does have we not learned the lessons from debenhams
From the time of the takeover, the countdown to disaster started. I said four years till it is shredded and sold off. Maybe to Hilco to “turn it around”
Sir Ken will be spinning in his grave…
Why does the UK let rapacious American private equity firms take over key businesses? Utterly disgraceful and typical of greedy Conservative government.
Is no one watching Morrison’s buy of Mcolls and petrol stations. Or their push to break down the oligopolistic structure of Tesco, Sainsburys and Asda? Allow Morrisons time to expand and dig into the bigger market share and we will see better pricing and options in the long-run.
With interest rates rising fast I wonder whether the £6billion debt was at a fixed rate and if not 6% of their debt, where interest rates are heading, equates to £360million of interest payments vs profits of £201million. Like to see how they square that circle?
Morrisons did buy McColls, they’re trying very hard but I’m not convinced that will save them. 6.1 billion is a lot of debt in the current interest rate environment.