Outlets offloaded in restructuring
Co-op sells 298 small food stores to McColls
The £117 million deal, which requires the approval of the competition watchdog, will take McColl’s portfolio to 933 stores.
McColls chief executive Jonathan Miller said: “These stores are profitable, well invested, and the perfect size for our operating model. We expect the transaction to be significantly earnings enhancing for our shareholders.”
Co-op Food boss Steve Murrells said that the sale was “completely in line with our strategy, as these stores did not allow us to provide a sufficiently compelling own-brand offer for our members.”
The proceeds will be re-invested and all 3,808 staff will transfer to McColl’s on the same terms and conditions in November when the deal is expected to complete.
This is the latest move in a shake-up of the portfolio. In May it sold 100 former Somerfield supermarket stores to Hilco and last week bought six stores from My Local which fell into administration.
Over the past 12 months the Co-op has become the most frequently visited food retailer in the UK. In the last two years it has opened close to 200 stores and is actively pursuing 100 store acquisitions.