Morrisons plans sale of dozens of in-store pharmacies

Morrisons, the UK's fourth-largest supermarket chain, is seeking buyers for dozens of its in-store pharmacies as the Bradford-based retailer continues to strip out costs under the pressure of a substantial private equity debt load.

See our recent article: Morrisons supermarket chain mulling sale of food manufacturing arm.

The supermarket operates approximately 120 in-store pharmacies registered with the General Pharmaceutical Council. The company has confirmed that a "significant number" of those branches are to be sold, with decisions taken on a branch-by-branch basis rather than as a portfolio deal. Pharmacies sold will remain in operation within Morrisons stores but trade under the new owner's branding.

Boots, the high street pharmacy chain owned by American private equity firm Sycamore Partners, has been reported as an interested party. No formal bid has been tabled.

The sale
Morrisons has framed the disposal as the outcome of a business review that concluded certain pharmacies would be "better off being run as community pharmacies under independent ownership." Chief executive Rami Baitieh, who took over in late 2023, has described the current period as a challenging one and has made making the business "financially sustainable" a stated priority.

The branch-by-branch structure of the sale means there is no headline transaction value attached to the process. Financial terms for individual transfers have not been disclosed, and no formal sale adviser has been publicly announced. Morrisons closed four pharmacies outright during 2025 before deciding that divestiture, rather than closure, was the preferred route for the remaining targeted branches.

Financial pressure
The pharmacy sale is one component of a broader cost-reduction programme driven by the debt inherited from Morrisons' 2021 leveraged buyout by Clayton, Dubilier and Rice, which acquired the supermarket for £8.7 billion.

In its full-year results for the period ending February 2025, Morrisons reported group revenue of £15.8 billion, up 3.2%, and EBITDA of £835 million. However, annual interest charges of £281 million contributed to a pre-tax loss of £381 million. Net debt at the time stood at approximately £3.1 billion, reduced by around 40% from its post-acquisition peak through a series of asset disposals including a £2.5 billion petrol forecourt sale in 2021 and a series of property transactions in subsequent years.

The pharmacy disposal is described by analysts as a cost-removal exercise rather than a capital-raising one. Unlike a sale of a large manufacturing subsidiary or a property portfolio, the individual branch transfers are unlikely to generate material proceeds, but removing the operational costs of running loss-making or low-margin pharmacies reduces the drag on an already thin profit margin.

Morrisons is simultaneously exploring the sale of Myton Food Group, its food manufacturing arm, which operates 19 production facilities and employs more than 6,600 people, in a separate disposal process also aimed at debt reduction.

A sector under strain
The Morrisons pharmacy sale is taking place against a backdrop of acute financial distress across community pharmacy in England. An independent economic review commissioned by NHS England and published in March 2025 identified an annual funding gap of £2.308 billion in the community pharmacy sector. The same review found that 65% of pharmacies were operating at a loss in 2025, with network closures running at approximately 15 per week across England.

Community pharmacy has experienced a real-terms funding reduction of around 20% over the past decade. No funding settlement for the 2026/27 financial year has been agreed between the government and the sector, leaving any prospective buyer of Morrisons pharmacy branches with significant uncertainty over future NHS contract income.

The Company Chemists' Association, responding to the Morrisons announcement, described the development as reflecting the "huge financial strain" facing the sector and warned that pressures on pharmacies had "reached an unsustainable level."

Wider industry context
Morrisons is not alone in retreating from pharmacy retail. LloydsPharmacy, once one of the largest pharmacy chains in the UK with more than 1,000 branches, completed the sale of its remaining 1,054 high street locations by March 2026, ending its presence on the British high street entirely. Boots, which has been named as a potential acquirer of Morrisons branches, is itself implementing a 300-branch closure programme as part of its own cost-cutting strategy under Sycamore Partners' ownership.

The consolidation of in-store pharmacy operations among major supermarkets reflects a structural reassessment of whether embedded health services generate sufficient returns to justify their cost base in a period of constrained NHS funding and rising operational overheads.

About Morrisons
Wm Morrison Supermarkets was founded in Bradford in 1899 and operates more than 500 stores across the UK. It was taken private by Clayton, Dubilier and Rice in October 2021 in one of the largest leveraged buyouts of a British retailer. The company employs approximately 110,000 people and has historically operated as one of the UK's most vertically integrated supermarket chains, owning significant food manufacturing and farming operations in addition to its retail network.

Browse our current listings of UK pharmacies for sale.

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