‘Cash generative’ Morrisons…

I heard on Radio 4 this morning that like any supermarket, Morrisons was ‘cash generative’.

I’m sure it is.

That is allegedly the simple appeal for the New York private equity bid – and allegedly, too they have ‘assured’ that they will not engage in property sale and leaseback or any similar sell-off.

As Morrisons also happens to be a major UK food producer and processor, I confess I’m less than reassured.

Rent will be extracted one way or another…

Frankly I cannot understand how government declines to prevent such a major part of the UK food retail and processing sector from falling in to foreign and necessarily extractive, hands.

Does our government think?

That, I’m afraid is a rhetorical question.. For it certainly does not.

Allegedly the buyers are long term – and we must remember that the deal has not yet been approved, although the buying premium is so large shareholders who do not understand or have interests in UK food requirements, would definitely be crazy to refuse.

If all this goes towards government promoted ‘cheap’ food it will, I fear, be a complete joke – UK farmers will be no better off, even if Morrisons is itself also a farmer.

Farmers need protection and looking after – as we also heard on Radio 4 this morning.

We certainly need decent and reasonably priced food – and clearly Morrisons, usually recognised as next cheapest, after Asda, offers also considerably better general quality.

I just wonder what, for private equity, ‘harnessing’ the cash generation actually means.

It grieves me to say that we shall probably see – and, I fear, it may well be not to our general advantage….

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