TESCO has bought ten former Safeway stores from Wm Morrison for an estimated £158 million, leaving the northern chain with nine sites to sell to satisfy competition authorities.
Morrison was forced to sell 52 stores to gain clearance for its £3 billion takeover of the Safeway supermarket group this year. This has since been reduced to 51.
Tesco has acquired stores in Sheffield, Carnforth and St Helens in Lancashire and Ingleby Barwick and Redcar near Middlesbrough, subject to approval from the Office of Fair Trading.
The stores have a book value of £87.6 million, but Morrison said that it would not reveal how much Tesco had paid for them until all stores had been divested.
Under competition rules, Britain’s biggest supermarket retailer is able to acquire a maximum of 24 sites.
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Analysts said that Morrison had attempted to limit the number of stores sold to its most powerful competitor.
Asda, the second largest supermarket chain in the UK, has bought just three of the divestment stores, while J Sainsbury and Waitrose have each acquired 14. The Co-operative Group has taken over one store.
Of the remaining nine stores, Morrison is in final negotiations to sell four.
Analysts expect that five sites will be sold to non-food retailers or a general store such as Marks & Spencer.
Bob Stott, joint managing director of Morrison, said: Our integration of the Safeway business is progressing and today’s announcement is a further step in the overall process.”
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Poor performance by Safeway’s supermarkets since Morrison took over resulted in the northern group’s first profit warning in July.
Morrison fell 2¼p to 200p yesterday and shares in Tesco lost ½p to finish at 275¼p.