Asda's billionaire owners take on Morrisons with final offers for McColl's

Supermarket giant Morrisons and the Issa brothers, the billionaires who own Asda, have submitted final offers to rescue collapsed retailer McColl's.

McColl's fell into administration on Friday, plunging the future of its 1,100 shops and 16,000 staff into doubt. Morrisons and EG Group, whose brands include LEON, Cooplands and Euro Garages, made the move prior to the administrators' Sunday 6pm deadline for offers.

The PA news agency reported that EG has bowed to pressure to look after McColl's pension liabilities, in a move that means that its 2,000 members will avoid a cut of up to 20% to their promised pensions over their lifetimes.

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Trustees for the McColl's pension schemes have called on the Business Secretary Kwasi Kwarteng to do whatever he can to ensure pension scheme members are well protected.

Morrisons' 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.

McColl's filed a notice for administration on Friday and is now expected to formally enter administration today before a pre-pack deal is completed. It is understood that EG group has proposed to retain the retailer's stores and staff, promising to increase the lowest rate of McColl's staff to £10.05.

However, it is predicted that any sale to EG could result in short term disruption to supply for McColl's stores. Morrisons is currently McColl's wholesale supply partner and is expected to immediately terminate its deal with the convenience chain if their takeover move is unsuccessful.