Morrisons share price: Group could hire My Local workers

on Jun 22, 2016
Updated: Oct 21, 2019
Listen

Wm Morrison Supermarkets (LON:MRW) is offering to hire former staff who could lose their jobs as a result of the likely collapse of My Local, the group which took over the FTSE 100 grocer’s convenience store chain last year, the Guardian has reported. The blue-chip supermarket is also potentially facing a liability of up to £20 million in relation to the potential collapse.

Morrisons’ share price meanwhile has surged in today’s session, having added 2.15 percent to 191.33p as of 13:23 BST, outperforming the benchmark FTSE 100 index which currently stands 0.87 percent higher at 6,280.69 points. The supermarket’s shares have gained over seven percent over the past year, and are up just under 30 percent in the year-to-date.
The Guardian reported today that Morrisons was offering to hire former staff, with My Local having filed a notice of intention to appoint administrators, putting 1,700 jobs at risk. My Local bought 140 Morrisons M Local convenience stores for 25 million in September last year.

“We are saddened and disappointed to learn that My Local is about to enter administration,” the FTSE 100 grocer said in a statement, as quoted by the newspaper. “We want to help our former colleagues who now work for My Local. We can therefore confirm that if no buyer is found, and stores close, we will welcome our former colleagues back to a job at Morrisons.”
The blue-chip grocer, however, is also facing a potential liability of up to £20 million, having retained a guarantee on a number of lease obligations in relation to last year’s sale, meaning that they will revert to Morrisons if My Local collapses.
In analyst news, Societe Generale reiterated its ‘sell’ rating on Morrisons this month, with a price target of 150p on the stock. HSBC meanwhile continues to see the supermarket as a ‘hold’, valuing the shares 190p.
As of 13:54 BST, Wednesday, 22 June, Wm. Morrison Supermarkets plc share price is 191.40p.

Are you looking for fast-news, hot-tips and market analysis? Sign-up for the Invezz newsletter, today.