Morrisons has begun the sell-off of some of its in-store pharmacies under the latest part of its cost-cutting plan.
In February, Morrisons notified property agents to put some of its 120 in-store pharmacies up for sale. The sell-off would be handled on a site-by-site basis, it said at the time.
The first of those deals have now been completed and have seen Morrisons sell a small number of sites to individual buyers over the past few months, according to The Telegraph.
A “handful” of the sites have been acquired by independent pharmacy chains, while other locations have been taken on by existing management. Morrisons hopes to have sold dozens by early next year.
It comes as CEO Rami Baitiéh steps on with his turnaround plan.
Despite a slow start, which saw the Bradford supermarket lose its spot as the UK’s fifth-largest grocer to Lidl, sales have picked up, with the supermarket revealing its fifteenth consecutive quarter of growth in a sales update earlier this month.
Baitiéh is targeting “capital-light growth” as part of his turnaround plan, and has been reviewing Morrisons’ entire estate to identify unprofitable areas, which could be sold or outsourced.
In February 2024 Morrisons sold 337 petrol forecourts to Motor Fuel Group, which is also owned by CD&R.
The supermarket has also since closed and sold its Rathbones bakery, ended its newspaper delivery service, and is in the process of selling up more of its company-owned Morrisons Daily c-store sites to franchisees. It has also completed several sale and leaseback deals on supermarket sites.
It has helped CD&R raise more than £3.2bn towards paying off Morrisons, according to research by the FT and property agency Cushman & Wakefield published in January. Some of those funds are being put towards servicing Morrisons’ £3.2bn debt pile.
Morrisons is the latest supermarket to retreat from in-store pharmacies amid a wider crisis in the UK pharmacy sector, which has battled with rising costs as well as a shortfall in NHS funding.
Sainsbury’s announced the closure and replacement of all of its in-store Lloyds Pharmacies in January 2023, following their closure by Lloyds owner Boots.
The Grocer understands Morrisons does not intend to sell off all of its pharmacy estate, or close any of the sites. Any sites that have already been sold will continue to operate as usual, just under a different ownership fascia.
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