What could John Lewis Partnership’s ownership restructure mean for Waitrose?

Waitrose parent company, the John Lewis Partnership is in the early stages of exploring the sale of a minority stake in the business to raise funds.

If the move was to go ahead, the business which has been 100% owned by its staff for more than 70 years, would no longer operate under this same ownership structure.

According to reporting by The Sunday Times, chair Sharon White is said to be exploring the plan which would look to raise £1 billion to £2 billion in new investment.

Selling a stake of the business would also require any change to the John Lewis consitution to be voted on and approved by more than two thrids of the partnership council.

Any money raised by selling shares would be put back into the business, rather than given to staff at Waitrose and John Lewis.

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The move wouldn’t be the first time that the John Lewis Partnership has made deals with third parties, as Waitrose invested in online-only supermarket Ocado when it was founded, which saw it selling only Waitrose products.

However Ocado ceased selling own-brand groceries from the upmarket retailer in September 2020, before it instead partnered with M&S.

Commenting on the potential move, John Lewis told The Sunday Times: “We’ve always said we would seek partnerships to help fund our transformation and exciting growth plans. We’ve done this with Ocado in the past and now with Abrdn.”

“Our partners, who own the business, will be the first to hear about any developments,” the spokesperson added.

Global Data gloabal retail research director, Patrick O’Brien told Grocery Gazette: “At this stage John Lewis may be just kite flying – in order to test the strength of feeling both with customers and partners.

“While the former are unlikely to object in a meaningful way, it would be a strange move given how much investment was made into the rebrand to emphasise its partnership structure to its customers.”

O’Brien said that this could cause long-lasting damage to the business as Partners “are likely to mobilise against the plans,” adding that any changes to the constitution would be a “divisive issue that would cause internal fractions which could last for years.”

“It would seem that the only way to get partners on board with such a plan would be to make it an existential matter for the company, but this in itself would be a dangerous tactic, given how that could impact shopper trust.”