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A
source familiar with the matter told Reuters Greybull was
working with a team of industry executives to take over about
150 stores that trade as M local and generate annual sales of
about 300 million pounds ($470 million).
The possible deal was first reported in the Sunday Telegraph
newspaper.
Both Greybull and Morrison declined to comment.
Morrisons was a late entrant into Britain's fast-growing
convenience sector, opening its first stores in 2011. Though it
has since grown at pace, its convenience presence is tiny
compared with bigger rivals Tesco and Sainsbury and has
little bearing on its profit performance.
A ramp-up under former CEO Dalton Philips failed to deliver the
level of trading it had anticipated.
Morrisons said in March it would close 23 M local stores during
its 2015-16 financial year and would significantly slow new
openings. It would also review the M local project and approach
to site selection.
Potts, who joined as CEO in March, has said he did not think M
local was working in its current form and believed many stores
were not in the right location.
He has said his priority is improving the performance of
Morrisons' more than 500 core supermarkets and making the group
simpler, leaner and more cost conscious.
Potts is due to give update on his plans on Sept. 10, when the
company is also due to publish first-half results.
Morrisons shares were down 1.3 percent at 176 pence by 1020 GMT,
valuing the business at 4.1 billion pounds.
($1 = 0.6390 pounds)
(Reporting by Freya Berry and James Davey; Editing by David
Holmes)
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