91WZ Morrison.wm 31

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES OF ARTICLE 7 OF THE MARKET ABUSE REGULATION (EU) 596/2014 AS IT FORMS PART OF UK DOMESTIC LAW BY VIRTUE OF THE EUROPEAN UNION (WITHDRAWAL) ACT 2018, AS AMENDED.

For immediate release

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES OF AMERICA, ITS TERRITORIES AND POSSESSIONS, ANY STATE OF THE UNITED STATES OF AMERICA OR THE DISTRICT OF COLUMBIA (THE "UNITED STATES") OR IN OR INTO OR TO ANY PERSON RESIDENT OR LOCATED IN ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT (SEE "OFFER AND DISTRIBUTION RESTRICTIONS" BELOW).

THIS ANNOUNCEMENT IS FOR INFORMATION ONLY AND IS NOT AN OFFER TO PURCHASE OR A SOLICITATION OF AN OFFER TO SELL ANY SECURITIES.

20 May 2024

MORRISONS ANNOUNCES COMMENCEMENT OF DEBT REDUCTION TRANSACTIONS

Wm Morrison Supermarkets Limited ("Morrisons") announced today the commencement of a cross-instrument debt reduction exercise across certain outstanding secured and unsecured debt instruments of the Group (as defined below). The debt reduction exercise is being conducted as a combination of multiple simultaneous tender offers pursuant to an unmodified Dutch auction procedure (as set out below) and a contemplated Term Loan Solicitation (as defined below). As part of this debt reduction exercise, the Group may also consider engaging in private negotiations with select holders of its indebtedness with the goal of buying back discrete amounts of outstanding debt instruments that are not being targeted in the Tender Offers (as defined below) or the Term Loan Solicitation. To fund the repurchases of indebtedness and deleveraging transactions pursuant to the Tender Offers, the Term Loan Solicitation and such privately negotiated buy-backs, if any, the Group may use its available liquidity in an aggregate principal amount of up to (and including) £1,000,000,000.

Term Loan Solicitation

Market Bidco Limited intends to launch a solicitation process (the "Term Loan Solicitation") under the senior facilities agreement originally dated 3 November 2021 (as amended and/or amended and restated from time to time) among Market Holdco 3 Limited (the "Parent"), Market Bidco Limited and the other parties named therein (the "Senior Facilities Agreement"), pursuant to which lenders under the Senior Facilities Agreement will be given the opportunity to offer to sell to the relevant borrower(s) an amount of their participation under one or more term facilities, subject to the terms and conditions set out in the Senior Facilities Agreement, and funded with the Group's available liquidity. HSBC Bank plc is appointed as the purchase agent (the "Purchase Agent") in connection with the Term Loan Solicitation. The current expectation is for the Term Loan Solicitation to be launched before 11:00 am on 29 May 2024, with any offers to be made by lenders under the term loan facilities in relation to the Term Loan Solicitation by 11:00 am on 31 May 2024 and any purchase of participations in the relevant term facilities pursuant to the Term Loan Solicitation being completed and settled on or before 5 June 2024.

Tender Offers

On the date hereof, Morrisons invites eligible holders of its notes due 2026 (the "2026 Notes"), 2029 (the "2029 Notes") and 2031 (the "2031 Notes" and, together with the 2026 Notes and 2029 Notes, the "EMTN Notes"), guaranteed by Safeway Limited (the "EMTN Notes Guarantor"), concurrently with invitations by (a) Market Bidco Finco Plc ("Market Bidco") to eligible holders of its sterling-denominated senior secured notes due 2027 (the "Senior Secured Notes") guaranteed by the Parent (the Parent, and, together with its consolidated subsidiaries, the "Group"), Market Bidco Limited, Morrisons, Optimisation Investments Limited, Safeway Stores Limited and the EMTN Notes Guarantor (collectively, the "Senior Secured Notes Guarantors") and (b) Market Parent Finco Plc ("Market Parent") to eligible holders of its senior notes due in 2028 (the "Senior Notes") guaranteed by the Senior Secured Notes Guarantors and Market Bidco (the "Senior Notes Guarantors" and, together with the EMTN Guarantor and Senior Secured Notes Guarantors, the "Guarantors"), in each case to tender for cash at prices to be determined pursuant to an Unmodified Dutch Auction Procedure (as defined below), subject to the terms and conditions contained in a Tender Offer Memorandum dated the date hereof (the "Tender Offer Memorandum") (as defined below). The relevant Offeror will only accept Tender Instructions (as defined below) in respect of the relevant Notes of any Series that are represented by a Regulation S global note and will not accept tenders with respect to any Note represented by a Rule 144A Global Note.

Morrisons, Market Bidco and Market Parent are referred to in this announcement each as an "Offeror" and together as the "Offerors", and the EMTN Notes, the Senior Secured Notes and the Senior Notes are referred to in this announcement each as a "Series" and together as the "Notes".

Morrisons is tendering for purchase for cash the EMTN Notes (the "EMTN Notes Offer"), concurrently with Market Bidco tendering for purchase for cash the Senior Secured Notes (the "Senior Secured Notes Offer") and Market Parent tendering for purchase for cash the Senior Notes (the "Senior Notes Offer") (each of the Senior Secured Notes Offer, the 2026 Notes Offer, the 2029 Notes Offer, the 2031 Notes Offer and the Senior Notes Offer, a " Tender Offer" and collectively, the "Tender Offers").

The Group has an available maximum cash amount of up to (and including) £1,000,000,000, in the aggregate, for the repurchase of indebtedness and deleveraging transactions pursuant to the Tender Offers, the Term Loan Solicitation and other privately negotiated buybacks, if any, subject to the Senior Notes Cap (as defined below) and excluding any accrued interest payments (the "Global Maximum Spend Amount"). The Offerors propose that the Maximum Spend Amount in the Tender Offers will be up to (and including) the Global Maximum Spend Amount (excluding Accrued Interest) (minus the amount used to fund term loan purchase transactions pursuant to the Term Loan Solicitation or other debt buy-backs pursuant to privately negotiated transactions, such purchase transactions and other debt buy-backs, together, the "Additional Debt Reduction Transactions").

The Offerors will determine the allocation of the Maximum Spend Amount in their sole and absolute discretion among each Series (subject to the Senior Notes Cap and the Additional Debt Reduction Transactions) and the Offerors reserve the right, in their sole and absolute discretion, to accept significantly more or less (or none) of the relevant Series. In no event shall the Series Acceptance Amount for the Senior Notes exceed £400,000,000 (the "Senior Notes Cap").

Capitalised terms used in this announcement but not otherwise defined have the meanings given to them in the Tender Offer Memorandum.

The following table sets forth certain terms of the Tender Offers.

The relevant Offeror reserves the right, in its sole and absolute discretion, not to purchase any Notes. The acceptance for purchase by the Offerors of Notes tendered pursuant to the Tender Offers is at the sole discretion of the relevant Offeror and tenders may be rejected by the relevant Offeror for any reason, in its sole and absolute discretion.

The Tender Offers are not being made to any "U.S. person" (as defined in Regulation S under the U.S. Securities Act of 1933, as amended (the "Securities Act")) or to any person in the United States. The Tender Offers are being made to dealers or other professional fiduciaries located outside the United States or acting on a discretionary basis only for the benefit or account of non-U.S. persons located outside the United States to the extent permitted by applicable law.

Introduction to and Rationale for the Tender Offers

On the terms and subject to the offer restrictions contained in the Tender Offer Memorandum, Morrisons invites the eligible holders of the outstanding EMTN Notes, Market Bidco invites the eligible holders of the outstanding Senior Secured Notes, and Market Parent invites the eligible holders of the outstanding Senior Notes to tender such Notes for purchase for cash by Market Bidco, Morrisons and Market Parent, as applicable (subject to the Offer and Distribution Restrictions contained in the Tender Offer Memorandum). The relevant Offeror will only accept Tender Instructions (as defined below) in respect of the relevant Notes of any Series that are represented by a Regulation S Global Note and will not accept tenders with respect to any Note represented by a Rule 144A Global Note.

The Tender Offers are made as part of the Group's debt reduction exercise in combination with a Term Loan Solicitation and other privately negotiated buybacks, if any.

Source of Funds of the Tender Offers

Market Bidco, Morrisons and Market Parent intend to fund all cash payments to Eligible Offerees pursuant to the Senior Secured Notes Offer, the EMTN Notes Offer and the Senior Notes Offer, respectively, with the Group's available liquidity.

Indicative Timetable for the Tender Offers and the Term Loan Solicitation

The expected timetable of events will be as follows:

Unmodified Dutch Auction Procedure

Subject to the relevant Minimum Instruction Amount, the amount the Offerors will pay for Notes validly tendered and accepted for purchase pursuant to the Tender Offers will be determined pursuant to an Unmodified Dutch Auction Procedure, as described in the Tender Offer Memorandum.

The cash consideration (rounded to the nearest £0.01) to be paid to each Noteholder on the Settlement Date in connection with a valid tender of Notes accepted for purchase, in accordance with the Unmodified Dutch Auction Procedure shall be equal to the product of (i) the aggregate principal amount of the Notes of the relevant Series of such Noteholder accepted for purchase pursuant to the relevant Tender Offer and (ii) the particular purchase price (expressed as a percentage of the principal amount of the relevant Series) specified by the relevant Noteholder in his or her Tender Instruction.

As the Purchase Consideration applicable to each Noteholder who validly submits a Tender Instruction that is accepted by the relevant Offeror is determined by reference to a particular Tender Price specified by such Noteholder in its Tender Instruction, the Purchase Consideration payable to each such Noteholder will not necessarily be the same, even where the same principal amount of Notes of the same Series is accepted for purchase from each such Noteholder.

The Offerors will determine, in their sole and absolute discretion, following the expiration of the Tender Offers, the allocation of the Maximum Spend Amount (subject to the amount of the Additional Debt Reduction Transactions) and the Series Acceptance Amount for each Series in the relevant Tender Offer (subject to the Senior Notes Cap), and the Offerors reserve the right, in their sole and absolute discretion, to increase or decrease the Maximum Spend Amount and to accept significantly more or less than such amount for purchase pursuant to the relevant Tender Offer, subject to the Senior Notes Cap and minus the amount of the Additional Debt Reduction Transactions.

If the acceptance of the aggregate principal amount of the Notes validly tendered for purchase pursuant to a Tender Offer would result in the relevant Series Acceptance Amount being exceeded, scaling may apply on a pro rata basis, if applicable.

Noteholders should inform themselves about any fees, charges, taxes, expenses or other amounts they may be required to pay or otherwise bear as a result of delivering or having delivered on their behalf any Tender Instruction and/or if such tender of Notes is accepted by the relevant Offeror, including any custodian or intermediary fees. Accordingly, Noteholders should consult in advance the fee lists or arrangements in place with any such party.

Accrued Interest

In addition to the relevant Purchase Consideration, each of the Offerors will also pay an Accrued Interest Payment in respect of Notes validly tendered and delivered and accepted for purchase by an Offeror pursuant to the relevant Tender Offer. The relevant Purchase Consideration and the Accrued Interest Payment for the Notes will be paid in pound sterling.

Noteholders Eligible to Participate in the Tender Offer

The Tender Offers are being made only to Eligible Offerees who are Noteholders and who, in each case, have represented to the relevant Offeror pursuant to the deemed representations included in the Tender Offer Memorandum that they are eligible to participate in the relevant Tender Offer. "Eligible Offerees" are defined as persons who satisfy all of the following criteria:

(a)  non-U.S. persons located outside the United States or dealers or other professional fiduciaries in the United States acting on a discretionary basis only for the benefit or account of non-U.S. persons located outside the United States, as those terms are defined in Regulation S; and

(b)  persons into whose possession the Tender Offer Memorandum may be lawfully delivered in accordance with the laws of the jurisdiction in which they are located and who are not a Sanctions Restricted Person or acting on behalf, or for the benefit of a Sanctions Restricted Person.

General Information about the Tender Offers

This announcement is a summary of the Tender Offer Memorandum only. It highlights selected information contained in the Tender Offer Memorandum and does not contain all of the information that Noteholders should consider before making a determination with respect to the Tender Offers. The complete terms and conditions of the Tender Offers, including the information on the tender instructions, scaling (as applicable) and acceptance amounts, are set forth in the Tender Offer Memorandum, which will be sent to Noteholders at their request. Noteholders are urged to read the Tender Offer Memorandum carefully in its entirety.

The Offerors have retained HSBC Bank plc (the "Dealer Manager") to act as Dealer Manager for the Tender Offers and Kroll Issuer Services Limited (the "Tender Agent") to act as Tender Agent for the Tender Offers.

Lazard & Co., Limited is acting as independent financial advisor to the Group in relation to both the Tender Offers and the Additional Debt Reduction Transactions.

The Tender Offers are commencing on 20 May 2024 and will expire at 4:00 p.m. (London time) on 31 May 2024 (such date and time, as may be extended, the "Expiration Deadline"), unless extended, withdrawn or terminated at the sole and absolute discretion of the relevant Offeror. The Settlement Date is expected to be on or around 6 June 2024. Tender Instructions (as defined in the Tender Offer Memorandum), once submitted, may not be withdrawn except in the limited circumstances outlined in the Tender Offer Memorandum.

THE TENDER OFFERS ARE NOT BEING CONDUCTED IN A MANNER ELIGIBLE FOR THE PROCEDURES OF THE DEPOSITORY TRUST COMPANY. To participate in the Tender Offers, an eligible holder of Notes must either hold such Notes through a Direct Participant in Euroclear Bank SA/NV or Clearstream Banking, S.A. or arrange for the transfer of its Notes so that they are held through such Direct Participant in Euroclear Bank SA/NV or Clearstream Banking, S.A.

Questions regarding the Tender Offers should be directed to the Dealer Manager. Requests for documentation or information in relation to the procedures for tendering Notes in the Tender Offers and the submission of Tender Instructions should be directed to the Tender Agent.

Tender Offer Website: https://deals.is.kroll.com/morrisons.

Contact Details:

DEALER MANAGER

HSBC Bank plc

8 Canada Square
London E14 5HQ
United Kingdom

Email: LM_EMEA@hsbc.com

For information by telephone:

+44 20 7992 6237

Attention: Liability Management, DCM

TENDER AGENT

Kroll Issuer Services Limited
The Shard
32 London Bridge Street
London SE1 9SG
United Kingdom
Email: morrisons@is.kroll.com

For information by telephone:
+44 20 7704 0880
Attention: Thomas Choquet

None of the Offerors, the Dealer Manager or the Tender Agent makes any recommendation as to whether Noteholders should tender any or all Notes. This announcement is not an offer to purchase any Notes or a solicitation of an offer to sell any Notes. The Tender Offers are being made solely by means of the Tender Offer Memorandum.

OFFER AND DISTRIBUTION RESTRICTIONS

THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM DOES NOT CONSTITUTE AN INVITATION TO PARTICIPATE IN THE TENDER OFFERS IN OR INTO ANY JURISDICTION IN WHICH, OR TO ANY PERSON TO OR FROM WHOM, IT IS UNLAWFUL TO MAKE SUCH INVITATION OR FOR THERE TO BE SUCH PARTICIPATION UNDER APPLICABLE SECURITIES LAWS. THE DISTRIBUTION OF THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM IN CERTAIN JURISDICTIONS MAY BE RESTRICTED BY LAW. THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM MAY ONLY BE DISTRIBUTED TO NON-U.S. PERSONS OUTSIDE THE UNITED STATES AND TO PERSONS TO WHOM IT IS OTHERWISE LAWFUL TO SEND THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM. FAILURE TO COMPLY WITH THESE REQUIREMENTS MAY RESULT IN A VIOLATION OF APPLICABLE SECURITIES LAWS. PERSONS INTO WHOSE POSSESSION THIS ANNOUNCEMENT AND THE TENDER OFFER MEMORANDUM COMES ARE REQUIRED BY EACH OF THE OFFERORS, THE DEALER MANAGER AND THE TENDER AGENT TO INFORM THEMSELVES ABOUT AND TO OBSERVE ANY SUCH RESTRICTIONS.

United States

The Tender Offers are not being made, and will not be made, directly or indirectly in or into, or by use of the mail of, or by any means or instrumentality of interstate or foreign commerce of or of any facilities of a national securities exchange of, the United States or to any U.S. Person. This includes, but is not limited to, facsimile transmission, electronic mail, telex, telephone, the internet and other forms of electronic communication. The Notes may not be tendered in the Tender Offers by any such use, means, instrumentality or facility from or within the United States or by persons located or resident in the United States as defined in Regulation S under the Securities Act. Accordingly, copies of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Tender Offers are not being, and must not be, directly or indirectly mailed or otherwise transmitted, distributed or forwarded (including, without limitation, by custodians, nominees or trustees) in or into the United States or to any U.S. Person (as defined in Regulation S under the Securities Act). Any purported tender of Notes in the Tender Offers resulting directly or indirectly from a violation of these restrictions will be invalid and any purported tender of Notes made by, or by any person acting for the account or benefit of, a person resident or located in the United States, a U.S. Person or any agent, fiduciary or other intermediary acting on a non-discretionary basis for a principal giving instructions from within the United States will be invalid and will not be accepted.

Each Noteholder participating in the Tender Offers will represent that it is not a U.S. Person, it is not located in the United States and it is not participating in the Tender Offers from the United States, or it is acting on a non-discretionary basis for a principal located outside the United States that is not giving an order to participate in the Tender Offers from the United States and it is not a U.S. Person. For the purposes of this announcement and the above paragraph, "United States" means the United States of America, its territories and possessions, any state of the United States of America and the District of Columbia.

United Kingdom

The communication of this announcement, the Tender Offer Memorandum and any other documents or materials relating to the Tender Offers is not being made, and such documents and/or materials have not been approved, by an authorised person for the purposes of section 21 of the Financial Services and Markets Act 2000. Accordingly, such documents and/or materials are not being distributed to, and must not be passed on to, the general public in the United Kingdom. The communication of such documents and/or materials as a financial promotion is only being made to (i) those persons in the United Kingdom falling within the definition of "investment professionals" (as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the "Financial Promotion Order")), (ii) persons who fall within Articles 43(2) of the Financial Promotion Order, which includes a member or a creditor of the Company, (iii) persons who fall within Article 49(a) to (d) of the Financial Promotion Order ("high net worth companies, unincorporated associations etc."), or (iv) any other persons to whom it may otherwise lawfully be made under the Financial Promotion Order.

European Economic Area (EEA)

In any European Economic Area (EEA) Member State (the "Relevant State"), the Tender Offers are only addressed to and are only directed at qualified investors in that Relevant State within the meaning of Regulation (EU) 2017/1129 of the European Parliament and of the Council of 14 June 2017, as amended (the "Prospectus Regulation").

Each person in a Relevant State who receives any communication in respect of the Tender Offers contemplated in this announcement and the Tender Offer Memorandum will be deemed to have represented, warranted and agreed to with the Dealer Manager and the Offerors that it is a qualified investor within the meaning of Article 2(e) of the Prospectus Regulation.

France

The Tender Offers are not being made, directly or indirectly, in the Republic of France other than to qualified investors (investisseurs qualifiés) within the meaning of Article 2(e) of the Prospectus Regulation and as defined in Article L.411-2 1° of the French Code monétaire et financier. Neither this announcement, the Tender Offer Memorandum nor any other documents or materials relating to the Tender Offers have been or shall be distributed in France other than to qualified investors (investisseurs qualifiés), and only qualified investors (investisseurs qualifiés) are eligible to participate in the Tender Offers. This announcement, the Tender Offer Memorandum and any other document or material relating to the Tender Offers have not been and will not be submitted for clearance to, nor be filed with or approved by, the Autorité des marchés financiers.

Italy

None of the Tender Offers, this announcement, the Tender Offer Memorandum or any other documents or materials relating to the Tender Offers has been or will be submitted to the clearance procedure of the Commissione Nazionale per le Società e la Borsa ("CONSOB").

The Tender Offers are being carried out in the Republic of Italy as exempted offers pursuant to article 101-bis, paragraph 3-bis of the Legislative Decree No. 58 of 24 February 1998, as amended (the "Financial Services Act") and article 35-bis, paragraph 4 of CONSOB Regulation No. 11971 of 14 May 1999, as amended.

Noteholders or beneficial owners of the Notes that are located in Italy can tender some or all of their Notes pursuant to the Tender Offers through authorised persons (such as investment firms, banks or financial intermediaries permitted to conduct such activities in Italy in accordance with the Financial Services Act, CONSOB Regulation No. 20307 of 15 February 2018, as amended from time to time, and Legislative Decree No. 385 of 1 September 1993, as amended) and in compliance with applicable laws and regulations or with requirements imposed by CONSOB or any other Italian authority.

Each intermediary must comply with the applicable laws and regulations concerning information duties vis-à-vis its clients in connection with the Notes or the Tender Offers.

General

Neither this announcement, the Tender Offer Memorandum nor the electronic transmission thereof constitutes an offer to buy or the solicitation of an offer to sell Notes (and tenders of Notes for purchase pursuant to the Tender Offers will not be accepted from Noteholders) in any circumstances in which such offer or solicitation is unlawful. In those jurisdictions where the securities, blue sky or other laws require a Tender Offer to be made by a licensed broker or dealer and any of the Dealer Manager or any of its affiliates is such a licensed broker or dealer in any such jurisdiction, such Tender Offer shall be deemed to be made by the Dealer Manager or such affiliate, as the case may be, on behalf of the Offerors in such jurisdiction.

In addition to the representations referred to above in respect of the United States, each Noteholder participating in a Tender Offer will also give certain representations, acknowledgements, warranties and undertakings and make certain agreements in respect of the other jurisdictions referred to above and generally as set out in the Tender Offer Memorandum. Any tender of Notes for purchase pursuant to a Tender Offer from a Noteholder that is unable to make these representations will not be accepted. Each of the Offerors, the Dealer Manager and the Tender Agent reserves the right, in its sole and absolute discretion, to investigate, in relation to any tender of Notes for purchase pursuant to a Tender Offer, whether any such representation given by a Noteholder is correct and, if such investigation is undertaken and as a result the relevant Offeror determines (for any reason) that such representation is not correct, such tender may be rejected.