All 16,000 jobs at McColl's are set to be saved after Morrisons agreed a deal to rescue the collapsed retailer.
The supermarket giant has seen off a rival bid from EG Group, which is owned by the billionaire Issa brothers who bought Asda for £6.8bn. The deal comes after the convenience chain signalled its intension to file for administration on Friday in a move which plunged the future of its 1,100 shops and 16,000 staff into doubt.
Final bids were submitted ahead of the 6pm deadline on Sunday by EG Group, the retail giant owned by the Issa brothers and TDR Capital, and Morrisons. The offer from Blackburn-headquartered EG Group, whose brands also include LEON, Cooplands and Euro Garages, included keeping 16,000 jobs and all of McColl's stores open.
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It was reported this morning that EG had bowed to pressure to look after McColl's pension liabilities, in a move that would have meant that its 2,000 members would avoid a cut of up to 20% to their promised pensions over their lifetimes.
Trustees for the McColl's pension schemes had also called on the Business Secretary Kwasi Kwarteng to do whatever he can to ensure pension scheme members are well protected.
The successful deal from Morrisons comes after i early approaches had reportedly been rejected by lenders who preferred EG's offer to instantly repay more than £160m in debts from McColl's.
It is believed that Morrisons has now said it will also repay the lenders in cash.
In a statement issued on Friday, McColl's said: "Further to the announcement on 3 May 2022, the company's senior lenders have this morning declined to further extend the waiver of the company's banking covenants, which has now expired.
"Whilst the constructive discussions with the company's key wholesale supplier to find a solution with them to the company's funding issues and create a stable platform going forward had made significant progress, the lenders made clear that they were not satisfied that such discussions would reach an outcome acceptable to them."
Kevin Mountford, savings expert and co-founder of Raisin UK, said; "It makes total sense for Morrisons to fight to save McColls.
"McColl's also trades under the name Morrisons Daily, which is Morrisons answer to Tesco Express, which has helped Tesco see huge profits.
"Morrisons isn't new to the convenience store business, with Morrisons earlier operating M Local stores, but their stores collapsed in 2015 and were rebranded as My Local stores.
"With McColl's facing administration, Morrisons was once again at risk of losing their convenience store formats, which was going to be a huge concern for Morrisons' new owners as Morrisons Daily was performing well compared to McColl's original brand.
"With the EG Group wanting to buy McColl's, Morrisons Daily would have been at risk as the EG Group owns the supermarket Asda, direct competitors. This will have no doubt spurred Morrisons on to protect the Morrisons Daily business.
"We should also expect to see McColl's further progress with their rebranding of stores to Morrisons Daily, and this could hugely work in Morrisons' favour as their convenience store numbers grow to compete against Tesco.
"It's also brilliant news for communities, with jobs protected and local convenience stores open, and McColls avoiding over 16,000 people being made redundant."
McColl's has struggled financially in recent years after witnessing soaring costs due to supply chain disruption, inflation and its large debt burden.
On Thursday evening, McColl's had said it was in talks over "potential financing solutions" to resolve its funding issues.
Shares in McColl's were suspended earlier this week after the company delayed the publication of its latest financial results due to its financing talks.
