Fortress could divide Morrisons into opco and propco

Fortress is likely to release cash from Morrisons’s property empire even without sale and leasebacks. The private equity group, whose £9.3bn offer has been approved by the board, has vowed to respect the “fundamental character” of the grocer, including its high level of property ownership, promising that there would not be “any material store sale and leasebacks”. However, experts have looked to Fortress’s tactics at previous purchases for clues as to how it will extract cash from the freehold portfolio. One such approach is an opco-propco structure. At Majestic Wine, which Fortress acquired in December 2019, freehold assets were immediately transferred into a separate property entity, also controlled by the private equity group, and leased back to the wine merchant for 25 years. Alternatively, it could issue bonds secured against the properties. The FT (£) To send feedback, e-mail piers.wehner@eg.co.uk or tweet