Co-op takeover of­fer backed by Nisa’s board

The Daily Telegraph - Business - - Business - By Ash­ley Arm­strong

CON­VE­NIENCE chain Nisa has rec­om­mended its 1,190 shop­keeper mem­bers agree to a £143m takeover from the Co-op­er­a­tive Group after four months of stop-start talks.

The Co-op­er­a­tive has said that it will pay £137.5m to Nisa mem­bers to buy 100pc of the busi­ness and cover deal costs of up to £5.5m. The Co-op will also ab­sorb £105m of Nisa’s ex­ist­ing debt. Nisa mem­bers, who will be re­quired to vote on any deal, will re­ceive an ini­tial equal pay­ment, a de­ferred share pay­ment over the next three years and ad­di­tional rebates over four years if shop­keep­ers stay with the en­larged group.

The con­ve­nience chain, which in­cludes 3,200 stores across the UK, will con­tinue as a stand-alone brand un­der the terms of the deal, al­though mem­bers will have the op­tion to sell their stores to the Co-op or be­come fran­chisees. The Co-op said that Nisa mem­bers would be able to ex­pand their prod­uct ranges with Co-op branded fresh and chilled prod­ucts and ben­e­fit from its big­ger pur­chas­ing power.

The mu­tual has also stressed its mem­ber-owned cre­den­tials and of­fered Nisa shop­keep­ers in­de­pen­dence to source ranges that suit their stores and be part of se­nior man­age­ment meet­ings at a lo­cal level.

Re­cently, the Co-op’s food busi­ness recorded its 14th con­sec­u­tive quar­ter of growth, re­port­ing a 3.5pc rise in like-for-like food sales in the 26 weeks to July 1.

Co-op boss Steve Mur­rells has pre­vi­ously said that a Nisa takeover could bol­ster the group’s nascent whole­sale busi­ness and would help the firm “grow scale and hold back in­fla­tion”.

“If our of­fer is ac­cepted by Nisa mem­bers and ap­proved by the CMA, we can de­liver a win-win for two mem­berled, com­mu­nity-fo­cused or­gan­i­sa­tions,” said Jo Whit­field, the Co-op’s food boss.

Peter Hart­ley, chair­man of Nisa, said the board was unan­i­mous in its de­ci­sion: “We firmly be­lieve the com­bi­na­tion with Co-op is in the best in­ter­ests of mem­bers.”

Steve Mur­rells, the Co-op boss, said the tie-up would help the busi­ness ‘grow scale’

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