Morrisons - comment
Morrisons is getting less cash than we hoped from the sale of its UK forecourt business to MFG. However, the transaction will drop leverage by a turn from 6.9x to 5.9x on our modelled FYE22/23 results (we had hoped for leverage at 5.1x). Morrisons reports FY 22/23 results today at 1200 GMT, and we expect more detail either in the release or on the call at 1400 GMT. The £500m gap between the equity value of £2bn and the £2.5bn price tag looks to have become a 20% minority stake in MFG instead of debt reduction. We will make our mind up on the value of the synergies and the MFG stake when we see more meat on the bones of the announcement, including confirmation that the revenue/EBITDA disposed of are as expected in the original deal announcement.