Morrisons announced today (12 January) that it has agreed to buy 16 former Netto stores from rival UK retailer Asda for GBP28.1m.

The retailer said the stores will increase its selling space by 120,000 square feet and is in addition to the 500,000 square foot target already outlined for 2011/12.

The announcement comes as Asda said it had struck deals to sell 39 of the 47 Netto stores it needs to sell to satisfy regulatory concerns over its planned acquisition of the discount chain.

The stores are expected to be handed over on a phased basis from March, with completion of the conversion to the Morrisons banner to take three months.

“These additional stores are an important next step in Morrisons’ growth. We are building on our strategy to bring Morrisons’ unique offer of freshly prepared, affordable food to more people in Britain,” said Morrisons CEO Dalton Philips.