Bradford business leaders today praised Sir Ken Morrison after the supermarket chief announced details of a fresh £3 billion swoop for rival Safeway.

The Morrisons chairman revealed yesterday that his new cash-plus-shares offer had been recommended for acceptance by the Safeway board.

And the deal - which will now go before Safeway shareholders - has been hailed as a major boost for Bradford.

Sir Ken reaffirmed that a new headquarters would be built in Gain Lane, Bradford, for the enlarged company, including some of the existing Safeway head office staff. The merger of the two businesses is likely to cause around 1,200 job losses, predominantly from Safeway's head office in Middlesex, but create about 1,000 new posts in Bradford.

And the impact could be far greater than that, with Morrisons well known for using a host of local suppliers which may feel the knock-on effect of its expansion.

Today Bradford Chamber of Commerce president Roland Clark applauded Sir Ken for showing faith in the city.

"I have just been reading about Morrisons as a 'Bradford-based company' in the national financial press, and I think that is good for us all," said Mr Clark. "I think this is really good both because the profile of the city is raised and it is also good for the local economy."

Councillor Simon Cooke, Bradford Council's executive member for the economy, said: "I am delighted that Morrisons has remained committed to keeping its head office in Bradford, both in terms of the image and the jobs that it will bring," he said.

The news that the Safeway board has recommended the offer was also welcomed by unions representing Morrisons' workers. Bill Connor, general secretary of shopworkers' union Usdaw, said: "We have worked closely with both Morrisons and Safeway for a number of years and are on record as saying that a merger between the two is in the best interests of our members."