Morrisons has sold its newspaper delivery service to News Team.
The undisclosed deal was completed earlier this month, and will see News Team take over all 18,000 existing accounts from Morrisons Daily stores.
The sale has drawn criticism in the press, as it resulted in around 1,700 paper boys and girls, most of whom worked for Morrisons Daily stores, losing their rounds as a result.
However Morrisons defended the sale, claiming that the cost of maintaining the business – which it took over following its acquisition of McColl’s in 2022 – had become “unsustainable” given the long-term decline in the newspaper home delivery market.
“The cost of maintaining our own dedicated network, which was built to service much higher volumes, has become unsustainable,” a Morrisons spokesman said.
“Following a thorough review, we’ve made the difficult decision to close the service and transition remaining customers to News Team, which operates the UK’s largest news and magazine delivery network. This has allowed us to protect the service for customers, including vulnerable customers, who rely on their daily newspaper delivery,” the spokesman said.
“Regrettably, this has resulted in our newspaper delivery colleagues, who worked on average less than eight hours per week, being made redundant and we have supported affected colleagues throughout this process.”
It’s the latest sale under private equity owners Clayton, Dubilier & Rice as CEO Rami Baitiéh looks to raise funds and cut costs as part of his turnaround plan.
In January 2024, Morrisons raised £2.5bn through the sale of its petrol forecourts to petrol giant Motor Fuel Group. The sale helped drive the retailer’s return to profit in 2024, its first since the CD&R takeover in 2021, reversing a pre-tax loss of £919m the year before.
Morrisons – for which the financial year starts in November – also strongly considered selling off its Rathbones Bakery in Wakefiled last year, following early-stage talks with prospective buyer Hovis.
A deal couldn’t be reached, so Morrisons briefly considered closing the factory, before settling on keeping it open with a stripped-down operation.
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