Mccoll's Retail Share Discussion Threads

[loganair] 02/7/2017 10:59

Telegraph - McColls plays kingmaker in Sainsbury's Nisa takeover


A Nisa source said that Sainsbury’s takeover bid was not conditional on McColl’s contract. Industry sources nevertheless questioned whether Sainsbury’s would be willing to pay £130m if 40pc of sales disappear.

Nisa granted exclusivity to Sainsbury's last week after believing that the supermarket offered its members more cash upfront than rival approaches from the Co-operative or wholesaler Bestway.

McColls itself is viewed as a potential takeover target as supermarkets jockey for position in the convenience market following Tesco’s £3.7bn bid for Booker. Analysts at Peel Hunt have said the newsagent could be “irresistable” to Sainsbury’s or Morrisons.

Industry sources are sceptical on whether Sainsbury's takeover of Nisa will succeed because of the latter's complicated ownership structure. Around 1,400 shopkeepers, many of which are fiercely independent, are members of the chain and will have a vote on any deal.

[dirty75] 02/7/2017 10:58

Great find. Thanks. Should get the share price moving .

[neilyb675] 02/7/2017 10:54

Mmmmmmmmmmmmm

[lizafl] 02/7/2017 10:16

Lots of rumours flying around!

[loganair] 23/6/2017 09:31

With news emerging over the weekend of the proposed “exclusivity agreement” between Nisa, the corner shop group, and Sainsbury’s, it’s a good time to assess the fortunes of both brands and consider why such an agreement is being talked about at this time.

The arrangement to buy Nisa is said to be worth close to £130m, with Sainsbury’s reportedly having beaten rivals such as the Co-op in advancing the deal. Any agreement between the two brands would still need to be put to Nisa’s 1,400 members, with over half needing to approve it.


This could me postive news for McColl´s because if due to their take over of Bookers, Tesco is forced to sell ´One Stop´ and or several hundreds of their convience stores then the above deal would mean Sainsburys would no longer be interested or be able to make a bid for any of them leaving basically McColl´s and the Co-op left as major bidders. As these two companies seemed to be working closely together seems to me will mean they may get even a better deal from Tesco being a forced seller.

[loganair] 16/6/2017 10:03

McColl's has launched a trial to stock private label products from one its competitors, the Co-op Group, as it seeks to explore ways of improving its range capabilities to meet rising expectations amongst its shoppers.

900 lines introduced in 25 McColl's stores:

The three-month trial has seen 900 Co-op branded lines across fresh, frozen and ambient categories launched in 25 McColl's stores; replacing branded and private label lines normally supplied to the retailer by Nisa or Palmer & Harvey.

Not involving the 298 acquisition stores:

The 25 trial stores are understood not to include any the 298 stores that have been acquired and transferred from the Co-op to McColl's over the last six months. With this process now approaching completion, these former Co-op stores are being supplied wholly through McColls core supply partners.

Jo Whitfield, Chief Executive, Co-op Food commented:

"Once we've seen how it goes, we'll think about whether to extend it or try different ways to show off our Co-op difference to more customers. This is just one way we're looking at to get more Co-op products into people's baskets rather than just opening stores."

[che7win] 08/6/2017 14:33

This is why I purchased for my ISA:

An example of a GARP stock:

MCLS
It took over 300 CO-OP stores and might take over more stores from Tesco if the Booker deal goes ahead and Tesco is forced to offload some convenience stores. The Co-op takeover has transformed growth out look:
MCLS
Market cap - £223m
EPS growth - next two years, 16.95% and 32.12% - so average 24.5% per year.
Yield - 5.5%
Share price 200p
2017 EPS forecast: 17.26p, 2018 EPS forecast: 22.8p
P/E for 2016 (actual) - 13.15
P/E for 2017 (estimate)-11.24
P/E for 2018 (estimate)- 8.51

PEG - 0.66 (2017), 0.26 (2018)

[aleman] 07/6/2017 10:27

Interesting, che7win. Thanks.

[che7win] 06/6/2017 15:59

Just joined you guys here with an initial 2000 shares, looks good value here for ISA.

[loganair] 24/5/2017 09:30

Retail experts believe that Tesco will be required to drop its One Stop brand or a large amount of Tesco Express shops before it can get clearance from the UK’s competition regulator for its merger with the wholesaler booker.

McColls intends to add 50 more shops into its existing pool each year. Acquiring Tesco’s One Stop would be a major starting point, said Miller

“Whether it’s One Stop or a number of stores we would be interested in having a look."

John Miller only recently took the reins of McColls, and on his first day on the job he oversaw the purchase of 300 Co-op stores in a £117 million deal. The transaction meant McColls now has around 1,300 stores in its pool.

[loganair] 24/5/2017 08:28

I would not be surprised if McColls are in talks with TESCO to buy One Stop, so when TESCO put in their formal application to the Competition Authorites to take over Booker, TESCO will b e able to say that One Stop is being sold and that they already have a buyer namely McColls.

One Stop will increase McColls (incl the Coop stores bought) by around 70% and will give them approximately 4% of the convenience store market. Even after the sale of One Stop, the combined Tesco/Booker will still have around 26.5% of the convenience store market.

[aleman] 22/5/2017 10:12

That's a very interesting article. What boost would we get from another large acquisition after the Coop deal did this to the numbers? We might be looking at pushing 30p eps and considerable scope for increasing the dividend as debt is reduced.


Year Ending Revenue (£m) Pre-tax (£m) EPS P/E PEG EPS Grth. Div Yield

2016-11-30 950.40 20.06 16.00p 12.9 0.5 25% 10.20p 4.9%
2017-11-30 1,137.93 24.95 17.29p 12.0 1.5 8% 10.27p 5.0%
2018-11-30 1,270.76 32.17 22.38p 9.4 0.3 29% 11.06p 5.3%

[loganair] 22/5/2017 09:14

Convenience store chain McColls plans swoop for Tesco stores The chief executive of McColls, the UK's largest convenience store chain, has said he plans to bid for part of Tesco's business, if the supermarket faces a stumbling block over its planned £3.7bn merger with wholesaler Booker.

[thevaluehunter] 21/5/2017 19:50

Not sure the 300 stores from co-op have been factored into the price yet.

[loganair] 17/5/2017 10:36

When it comes to TESCO take over of Bookers - Bestway Wholesale managing director Martin Race said: I believe Tesco is interested only in Tesco – and its shareholders – and will use the data it will obtain from Booker to earmark future Tesco Express or One-Stop stores.

“I would agree with the independent retailers that, with the increased pressure to improve profit, any potential savings by the take over will be retained by TESCO rather than passed on to retailers similar to what happened at the acquisition of One-Stop where prices were found to be higher in One-Stop stores than they were in Tesco Express formats. This should sound alarm bells for independent retailers.”

[loganair] 17/5/2017 10:11

Aleman - I agree I too am comfortable with the amount of debt that MCLS currently has, however if it comes about and TESCO is forced to sell to get their take over of Bookers through this would increase MCLS debt significantly.

I was in favour of Rolls Royce having a RI when they bought out Alison, Cadbury´s did the same, had two RI´s when they took over two other companies.

When I bought my house I took out only a 50% mortgage and paid it off after 3 years. I managed to do this as I was saving 60% of my salary to buy the house in the first place.

Personally I am dead against taking on debt where ever and when ever possible.

[aleman] 17/5/2017 09:31

After the Coop deal we are looking at net debt £140m. EBITDA £53m. and interest should be about £11m. MCLS has very stable cashflows so I'm not uncomfortable with the above numbers. The dividend paid out says the board are not either. I don't think I'd want to see the ratios rise, though. Any Tesco stores taken on would need to see similar ratios or better so a mixture of shares and debt would be needed. Don't forget the company had 97 stores for sale at the end of November, which will help a bit, as will recent rises in food prices, and even th etime needed to sort any deal out. MCLS might manage another 100-200 stores without a share issue, anything above that would need equity participation and might still cause indigestion if the Coop stores are not bedded in well enough.

[loganair] 17/5/2017 08:30

Barn - how many companies have gone bust because they´ve issued equity and how many companies have gone bust due to issuing debt?

A company can reduce or even forgo paying dividends all together while they need to pay the interest on any debt, if they are unable to pay the interest then the company is in a lot of trouble.

[barnesian] 15/5/2017 14:12

I'd take on debt. It's much cheaper than equity.

[neilyb675] 15/5/2017 12:30

Exactly the way to do it. I'd very much be supportive of such a move.