Morrisons and Asda struggling with debt

The private equity-owned supermarket sector in Britain is facing significant upheaval, particularly with Morrisons experiencing a notable departure of senior management. Over the summer, seven senior directors, including key figures such as convenience director Miles Foster and property director Mark Nowak, have left the company. Since the appointment of chief executive Rami Baitiéh in November, nearly a third of the top 60 executives at the Bradford-based chain have resigned, raising concerns about the stability and direction of the retailer. Morrisons has been struggling to regain its footing since its acquisition in a £7 billion leveraged buyout by US private equity firm Clayton, Dubilier & Rice (CD&R) in 2022. The ongoing management exodus highlights the challenges the supermarket faces in addressing operational issues and improving performance. The departures of experienced leaders may hinder the company's ability to implement effective strategies to turn around its fortunes. Meanwhile, Asda is also feeling the pressure, as it has begun to scale back long-term investments in an effort to address growing problems on the shop floor. The supermarket is reportedly focusing on immediate operational fixes rather than pursuing broader strategic initiatives. This shift in focus reflects the urgent need to stabilize the business amid increasing competition and changing consumer preferences. The situation in both Morrisons and Asda underscores the broader challenges facing private equity-owned supermarkets in the UK, as they navigate a complex retail landscape marked by economic pressures and shifting market dynamics.