Issa brothers to swoop on failed McColl’s chain
THE billionaire Issa brothers are set to buy collapsed convenience store chain McColl’s, saving 16,000 jobs.
Forecourt empire EG Group, controlled by Mohsin and Zuber Issa and a private equity firm, made a late swoop for the group.
The move will involve buying all 1,100 McColl’s stores and would safeguard staff.
The Daily Express understands the value of the deal is more than £200million, the bulk of which is taken up by McColl’s debts.
The rest includes giving its workers a pay rise – to £10.05 an hour in line with other EG Group staff.
But, controversially, the deal does not include taking on responsibility for the two McColl’s pension schemes.
It is likely that they will be assessed by the Pension Protection Fund.
While the schemes are unlikely to need rescuing by the fund, it is possible that the 2,000 members will end up with worse benefits than at present.
The deal would follow Pricewaterhouse Coopers being appointed as administrators on Monday. If the deal happens, it will be from under the nose of Morrisons.
The supermarket made an offer which was rejected by lenders.
Morrisons is a wholesaler to McColl’s, which runs 200 stores under the Morrisons Daily brand.
The Blackburn-born Issa brothers with private equity firm TDR Capital also now own Morrisons’ rival Asda.
However, the McColl’s deal is through EG Group and does not involve Asda.
The beleaguered convenience chain had earlier said: “In order to protect creditors, preserve the future of the business and to protect the interests of employees, the board was regrettably therefore left with no choice other than to place the company in administration.”
McColl’s shares were suspended earlier this week. It said shareholders are also likely to be left empty-handed.
It buckled under heavy debts in the pandemic and more lately because of inflation. It owes £170million.