WM Morrison Supermarkets : Indicative Results of Tender Offer

Wm Morrison Supermarkets Plc announces indicative results of Tender Offers for its €700,000,000 2.250 per cent. Notes due 2020, £400,000,000 4.625 per cent. Notes due 2023 and £400,000,000 3.500 per cent. Notes due 2026

NOT FOR DISTRIBUTION IN OR INTO OR TO ANY PERSON LOCATED OR RESIDENT IN THE UNITED STATES, ITS TERRITORIES AND POSSESSIONS (INCLUDING PUERTO RICO, THE U.S. VIRGIN ISLANDS, GUAM, AMERICAN SAMOA, WAKE ISLAND AND THE NORTHERN MARIANA ISLANDS), ANY STATE OF THE UNITED STATES OR THE DISTRICT OF COLUMBIA OR IN OR INTO ANY OTHER JURISDICTION WHERE IT IS UNLAWFUL TO RELEASE, PUBLISH OR DISTRIBUTE THIS ANNOUNCEMENT.

8 June 2016. Wm Morrison Supermarkets Plc (the Company) announces today the indicative results of its separate invitations to holders of its outstanding (a) €700,000,000 2.250 per cent. Notes due 2020 (ISIN: XS0945158821) (the 2020 Notes), (b) £400,000,000 4.625 per cent. Notes due 2023 (ISIN: XS0717069073) (the 2023 Notes) and (c) £400,000,000 3.500 per cent. Notes due 2026 (ISIN: XS0808629389) (the 2026 Notesand, together with the 2020 Notes and the 2023 Notes, the Notesand each a Series) to tender their Notes for purchase by the Company for cash (each such invitation an Offerand, together, the Offers).

The Offers were announced on 31 May 2016 and were made on the terms and subject to the conditions contained in the tender offer memorandum dated 31 May 2016 (the Tender Offer Memorandum). Capitalised terms used in this announcement but not defined have the meanings given to them in the Tender Offer Memorandum.

In the Tender Offer Memorandum, the Company invited Noteholders to tender their Notes for purchase up to an aggregate cash amount of £200,000,000 (as further described in the Tender Offer Memorandum). The Expiration Deadline for the Offers was 4.00 p.m. (London time) on 7 June 2016. The Company is pleased with the strong response received from Noteholders and as a result the Company expects to set the Aggregate Consideration Amount (as defined in the Tender Offer Memorandum) at approximately £152,000,000, which excludes the Company's Derivative Costs.

The results of the Offers, combined with the early repayment of the $250,000,000 US Private Placement Notes, which was announced by the Company on 10 March 2016, reduce the level of gross debt outstanding and the resulting interest expense incurred by the Company. The transactions will incur a one-off cost for the Company that will be recognised outside of underlying profit before tax.

Expected Series Acceptance Amounts and Aggregate Consideration Amount

As at the Expiration Deadline, the Company had received valid tenders for purchase of (i) €120,153,000 in aggregate nominal amount of 2020 Notes, (ii) £22,564,000 in aggregate nominal amount of 2023 Notes tendered pursuant to Non-Competitive Tender Instructions, and (iii) £14,120,000 in aggregate nominal amount of 2026 Notes validly tendered pursuant to Non-Competitive Tender Instructions.

In the event that the Company decides to accept Notes validly tendered pursuant to the Offers, it expects to set the Aggregate Consideration Amount at approximately £152,000,000, the 2020 Notes Acceptance Amount at approximately €120,153,000 the 2023 Notes Acceptance Amount at approximately £35,000,000 and the 2026 Notes Acceptance Amount at approximately £16,000,000.

2020 Notes

In the event that the Company decides to accept 2020 Notes validly tendered pursuant to the relevant Offer, and on the basis of the expected 2020 Notes Acceptance Amount, the Company expects to accept for purchase all 2020 Notes validly tendered pursuant to the relevant Offer with no pro ratascaling. Noteholders should note that this is a non-binding indication of the level at which the Company expects to set the 2020 Notes Acceptance Amount.

2023 Notes

In the event that the Company decides to accept 2023 Notes validly tendered pursuant to the relevant Offer, and on the basis of the expected 2023 Notes Acceptance Amount, the Company expects to set the 2023 Notes Purchase Spread at 249 bps (the Expected 2023 Notes Purchase Spread). Accordingly, the Company expects to (i) accept for purchase all 2023 Notes validly tendered pursuant to valid Non-Competitive Tender Instructions or validly tendered pursuant to valid Competitive Tender Instructions at a purchase spread equal to the Expected 2023 Notes Purchase Spread in full, with no pro ratascaling and (ii) not accept for purchase any 2023 Notes validly tendered pursuant to valid Competitive Tender Instructions at purchase spreads below the Expected 2023 Notes Purchase Spread. Noteholders should note that this is a non-binding indication of the level at which the Company expects to set the Expected 2023 Notes Purchase Spread and the 2023 Notes Acceptance Amount.

2026 Notes

In the event that the Company decides to accept 2026 Notes validly tendered pursuant to the relevant Offer, and on the basis of the expected 2026 Notes Acceptance Amount, the Company expects to set the 2026 Notes Purchase Spread at 259 bps (the Expected 2026 Notes Purchase Spread). Accordingly, the Company expects (i) accept for purchase all 2026 Notes validly tendered pursuant to valid Non-Competitive Tender Instructions or validly tendered pursuant to valid Competitive Tender Instructions at a purchase spread equal to the Expected 2026 Notes Purchase Spread in full, with no pro ratascaling and (ii) not accept for purchase any 2026 Notes validly tendered pursuant to valid Competitive Tender Instructions at purchase spreads below the Expected 2026 Notes Purchase Spread. Noteholders should note that this is a non-binding indication of the level at which the Company expects to set the Expected 2026 Notes Purchase Spread and the 2026 Notes Acceptance Amount.

Pricing for the Offers will take place at or around 1.00 p.m. (London time) today (the Pricing Time). As soon as reasonably practicable after the Pricing Time, the Company will announce whether it will accept valid tenders of Notes pursuant to all or any of the Offers and, if so accepted, the Aggregate Consideration Amount, each Series Acceptance Amount, each Purchase Spread, each Purchase Yield, each Purchase Price, the Applicable Exchange Rate and any Scaling Factors that will be applied to Notes of any Series.

The Settlement Date in respect of the Notes accepted for purchase pursuant to the Offers is expected to be 10 June 2016.

BNP Paribas (Telephone: +44 20 7595 8668; Attention: Liability Management Group; Email: liability.management@bnpparibas.com) and HSBC Bank plc (Telephone: +44 20 7992 6237; Attention: Liability Management Group; Email: liability.management@hsbcib.com) are acting as Dealer Managers for the Offers and Lucid Issuer Services Limited (Telephone: +44 20 7704 0880; Fax: +44 20 3004 1590; Attention: Victor Parzyjagla; Email: morrisons@lucid-is.com) is acting as Tender Agent.

DISCLAIMERThis announcement must be read in conjunction with the Tender Offer Memorandum. No offer or invitation to acquire any securities is being made pursuant to this announcement. The distribution of this announcement and the Tender Offer Memorandum in certain jurisdictions may be restricted by law. Persons into whose possession this announcement and/or the Tender Offer Memorandum comes are required by each of the Company, the Dealer Managers and the Tender Agent to inform themselves about, and to observe, any such restrictions.