Morrisons acquires Simply Fresh Foods

The new chief executive of Morrisons has made his first acquisition by purchasing Simply Fresh Foods, a supplier of packaged vegetables, to enhance its distribution services as it expands in the UK.

Dalton Philips took the helm at Morrisons in March and yesterday the grocer confirmed the acquisition of the facility based in Worsley, Manchester, for an undisclosed sum.

A Morrisons spokeswoman said: "We have taken the decision to expand our produce-packing capacity, acquiring the Worsley sites operated by Simply Fresh, which will supply packed vegetable lines." She added this was to meet the demand from its 10 million weekly customers, as it moves from being a "national to nationwide" grocer.

The facility in Worsley will form part of Morrisons' manufacturing division and provide a dedicated and distribution service to its more than 425 stores.

The UK's fourth biggest grocer operates 13 distribution centres and 13 manufacturing sites, including three abattoirs. It is one of the five biggest food producers in the UK.

Mr Philips, who had been chief operating officer at the Canadian grocer Loblaw since January 2007, will present his first thoughts on his strategic vision for Morrisons in September. Speculation is already building on whether he will go after convenience stores, non-food or an online grocery offer.

An existing partner of Morrisons, Simply Fresh Foods is a profitable business that supplies stir-fry mixes, prepared vegetables, and ready-to-eat salad products.