Sir Ken Morrison: Supermarket Sweep

Sensible man, Sir Ken. Careful, too, not given to shooting his mouth off or flashing his cash. He's 71 and has spent a lifetime building up the William Morrison supermarket chain. So what's he doing on TV, with a PR man and a £2.5bn bid for Safeway?

He is tough, bluff and uncompromisingly gruff. More Yorkshire than Geoffrey Boycott or millstone grit, Sir Ken Morrison has never been one for hogging the limelight or needlessly lavishing his hard-earned brass.

So it came as something of a shock to the City last week when the 71-year-old boss of the William Morrison supermarket group emerged from self-imposed northern obscurity to unleash a £2.5bn bid for fellow supermarket group Safeway. If successful, the daring swoop will make the company the third biggest grocer in Britain. For someone renowned for never spending money on acquisitions, this was some way to break the habit of a lifetime.

If it goes ahead, it could be the crowning achievement of a remarkable career. During 46 years at the helm he has transformed the business from a handful of market stalls into a £3bn retailing powerhouse. He has been running the company as long as Terry Leahy, chief executive of Tesco, has been alive.

Yet Sir Ken, who is worth £1.3bn, is showing no signs of losing his trademark truculence or gritty staying power. "He's actually speeding up rather than slowing down," says one incredulous colleague, an age-defying feat widely attributed to his second wife Lynne, a lawyer reputed to be half his age.

So keen is Sir Ken to jump into the big league from his position as Britain's fifth biggest supermarket operator, and a regional one to boot, that he is prepared to sacrifice his preferred existence as a virtual recluse. He has emerged from his magnificent 10-bedroom historic pile surrounded by private parkland in Swaledale, North Yorkshire, to appear on television bulletins. He has even hired a PR consultancy for the first time to help him sell the deal, a frippery that in the past he would have denounced as a waste of money. For Sir Ken became the ninth richest man in Britain by ostentatiously ignoring every modern business fashion, convention or trendy new code of corporate governance.

Like many a Yorkshireman, he sticks stubbornly to his own way of doing things – and has a little homily to justify each belief. He will have no truck with management consultants – "If you don't know how to run your own business, it's time to give up, isn't it?". And he is the only head of a major publicly quoted company in Britain to refuse to appoint independent directors – considering them far more expensive than another check-out girl and rather less use. Sir Ken also shies away from the fashion for internet shopping, declaring that the last time he delivered groceries was on a bike, and he has no desire to repeat the experience. He dislikes running up debts, once taking out a £70,000 loan from Midland Bank to expand his business 40 years ago but never using it. Supermarket loyalty cards are similarly eschewed, dismissed as "hype and gimmickry". His critics complain he runs the company – now a member of the FTSE 100 – like a family fiefdom; but as he looks set to declare his 36th year of unbroken sales and profit growth, he can be confident about his strategy.

William Morrison supermarkets, he declares, are "no nonsense" operations, offering "honest good value" and over three million shoppers, mostly in their northern heartland, clearly agree. In survey after market survey, his customers declare touching loyalty to a store that still has a comforting, old-fashioned feel, with its pie stalls, butchery and bakery counters and enormous cooked breakfasts served in the in-store cafes.

Aimed primarily at the skilled working classes, William Morrison's 119 supermarkets, from Enfield on the outskirts of London to Carlisle on the Scottish border, are the places to go for good value and wide choice – but of a certain kind. If you want mountainous stacks of cream cakes, fine, but forget the more exotic fare which competitors such as Waitrose pride themselves on.

So can Sir Ken compete in the southern England market, dominated by Sainsbury, Tesco and Waitrose, that he now wants to capture via Safeway? He is confident his formula will translate well. "Southern shoppers like to think they are sophisticated, don't they? But they're not. There's not so much difference down there. They say poor people need a bargain. Wealthy people appreciate one."

Sir Ken's devotion to thrift is demonstrated by his refusal to redecorate his modest Bradford headquarters, whose vintage fawn, brown and orange 1960s decor complete with teak cocktail cabinet now has a positively, if accidental, retro chic.

The Morrison family started as market traders in Bradford in 1899 just a few miles from where the firm's great rival, Asda, traces its roots to the old Associated Dairies. Sir Ken's father, William, built up a handful of shops and stalls in the north of England but retired due to ill-health in 1952 when junior was only 20. Having worked for his father's business since the age of five, when he took deliveries in the warehouse, and being the only boy of six children, Sir Ken was the natural successor.

He opened the family's first supermarket in 1961 and grew the business so quickly that it floated on the stock market six years later. The company continued to expand apace but many expected Sir Ken, knighted in 2000, to take a back seat when his first wife Edna, with whom he had three children, died of cancer in the early 1990s.

Quite the reverse. Sir Ken seemed to redouble his energy and eventually married again, having another child. Even second time round, he has not helped change nappies, declaring "I'm not into women's lib and that sort of thing." Any woman crossing his path is addressed as "luv", although these attitudes did not stop him recently appointing a woman as joint managing director.

A company with such a strong family heritage might be expected to have an heir apparent waiting in the wings. Sir Ken's son, William, does work for the company, but he is in his twenties and not yet ready to succeed his father. The man who had been groomed to take over, John Dowd, died recently. Lack of a successor is the one thing that bothers analysts about Morrisons.

William Morrison is expected to face fierce competition for the Safeway trophy from the world's largest supermarket group, the US-based Wal-Mart, owners of Asda. Such a battle would pitch American multinational might and muscle against the no-nonsense stubbornness of a self-made provincial billionaire with little formal education – but a masters degree in frugality and graft. From the University of Life, of course.

The outcome will determine whether there are four serious supermarket players in Britain – Tesco, Sainsbury, Asda and Morrisons/Safeway – or merely three. The price and quality of the food on the nation's dining tables may depend on it. If the Safeway deal goes through Sir Ken plans to rebrand most of the stores as William Morrison supermarkets, foisting an unfamiliar northern name on the high streets of southern England. It is a bold experiment and there are many sceptics who claim that snooty Surrey woman will never take to the supermarket known affectionately as "Mozzers" up north. But there is a precedent. Twenty years ago Tesco – the company founded on the principle of pile 'em high and sell 'em cheap – was similarly tagged down-market. It reinvented itself and has never looked back. Could William Morrison be about to pull off the same audacious trick?