The UK-based Co-operative Group has planned a complete takeover of its rival chain Somerfield. The deal is estimated to be pegged at around £1.6 billion.
The Somerfield deal will take Co-op’s portfolio to more than 3,100 supermarkets and convenience stores. The group will have almost 8 per cent of the market share, closing in on Morrisons, which is the UK’s fourth biggest supermarket at present with an 11.5 per cent market share.
Somerfield was put up for sale in January by a consortium led by private equity group Apax. At the time, it was hoped the sale would be worth about £2.5 billion, but the credit crunch had a serious impact on Somerfield’s sale price.
About 120 Somerfield stores are expected to be offloaded to other supermarkets following the sale.