Morrisons supermarket chain mulling sale of food manufacturing arm

Supermarket chain Morrisons is reportedly exploring the sale of its food manufacturing arm, Myton Food Group, as private equity owner Clayton, Dubilier & Rice looks to continue reducing the debt burden left by its £8.7 billion takeover of the Bradford-based grocer in 2021.

Myton Food Group, rebranded from Morrisons' in-house manufacturing operation in 2023, operates 19 production sites across the UK and employs 6,678 people. The division covers meat, seafood, produce, chilled foods, horticulture, bakery, eggs and pet food, making Morrisons the UK's second-largest fresh food manufacturer. A sale would represent one of the most significant disposals in the British grocery sector in recent years.

No formal sale process or adviser has been publicly announced. Standalone financial accounts for Myton Food Group are not publicly available, with the Companies House entity registered as a dormant holding vehicle. The only directly reported revenue figure within the division relates to Rathbones, the century-old Preston bakery operation, which reported revenues above £60 million before its decline and subsequent closure in January 2026 with 115 jobs lost.

At group level, Morrisons reported revenue of £15.8 billion in the year to February 2025, up 3.2% on the prior year, with EBITDA broadly flat at £835 million. However, the group recorded a pre-tax loss of £381 million, largely attributable to a £281 million debt interest bill stemming from the leveraged buyout. Net debt currently stands at approximately £3.1 billion, having been reduced by more than 40% from its post-acquisition peak through a series of disposals and refinancings.

The most significant of those disposals came in 2021, when CD&R sold Morrisons' petrol forecourt estate for £2.5 billion. Subsequent debt reduction has been achieved through refinancings and smaller asset sales, and the potential sale of Myton Food Group is understood to be part of the same ongoing deleveraging strategy.

The move comes against a deteriorating macroeconomic backdrop. The conflict in Iran has pushed oil prices sharply higher, with logistics operators warning that fuel cost increases are feeding directly into food prices.

UK inflation is forecast to end 2026 at 3.5% or above, with some fresh produce categories - including tomatoes, peppers and cucumbers, for which Iran is a key supply route - facing price rises of up to 15% within weeks.

Energy bills are projected to rise by around £250 per year for households. The inflationary environment is adding urgency to Morrisons' efforts to reduce its fixed cost base and interest obligations.

Morrisons had previously explored a sale of its manufacturing and distribution operations in 2022, though no transaction was completed at that time.

The rebranding of the division as Myton Food Group in 2023 was accompanied by a stated ambition to supply other retailers and wholesale customers beyond Morrisons' own stores, a strategy intended to demonstrate the arm's commercial viability as a standalone or third-party-owned business.

Morrisons declined to comment on the sale process.

Browse other food manufacturing businesses for sale in the UK

Share this article

Latest Manufacturing Businesses for Sale

---

---

---

View more businesses for sale