Morrisons has sold 114 of the smaller Safeway stores and a distribution centre to Somerfield for £260 million.
The outlets are from the Safeway compact format, and will all be converted to the Somerfield fascia.
Sixty-three of the stores are being sold directly to Somerfield for £115m. The other 51 stores and the distribution centre are being sold to a Barclays Bank joint venture which will lease them to Somerfield.
"This disposal will allow us to concentrate on our area of expertise of running larger stores, and will help us to speed up the conversion process," said Morrison's joint managing director Bob Stott.
"The sale of these stores means that we will be able to re-engineer our supporting infrastructure and achieve a much greater level of efficiency across our entire supply chain."
Somerfield's acquisition of the Safeway compact stores strengthens its presence in the increasingly-competitive convenience store sector.
"This acquisition represents an excellent opportunity for Somerfield to grow its estate without a significant increase in gearing, and to capitalise on its proven expertise in operating smaller stores," said chief executive Steve Back.
Somerfield also revealed its latest trading update. Like-for-like sales increased by 1.4 per cent at Somerfield stores, and by 0.2 per cent at Kwik Save outlets in the eight weeks to October 9.
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