The Co-operative Group has entered into an agreement to buy Somerfield for £1.57bn. Peter Marks, The Co-operative Group’s chief executive, said: “This is good news for consumers and for competition in the grocery market, where we will create a stronger fifth player in food and a convenience

store chain with unrivalled geographic reach.

“For The Co-operative Group this is a transformational deal – cementing our position as the UK’s premier community retailer and helping us significantly as we lead a renaissance of The Co-operative brand. Together, The Co-operative and Somerfield colleagues will be better placed than ever before to provide consumers with great choice, value and service.

“The acquisition of Somerfield will provide the rocket fuel for our three-year growth plan outlined in April of this year. Under this plan we are revitalising our retail estate under a single unified brand – modernising our stores, improving our product offer and service levels for customers and members, and reinforcing our co-operative difference.

“There is a strong strategic fit between the two businesses, with both focused on the highly competitive top-up and convenience shopping market. We anticipate real cost and revenue synergies, enabling us to enhance still further the overall value we deliver to our customers.

“Given a deal of this nature, there are likely to be some local competition issues. We are confident we will be able to work through these with the Office of Fair Trading.”

Somerfield chief executive Paul Mason said: “The Co-operative Group and Somerfield have a similar focus in terms of customers, store types, product ranges and business vision. Our shared vision of providing a high-quality and affordable convenience offer to local communities means that together we will be twice as strong, and therefore twice as able to deliver the local grocery shops British customers demand.”

More details in the August edition of Forecourt Trader.