CMA approves Co-op and Southern Co-op merger

The merger between the Co-operative Group and Southern Co-op has been given approval by the Competition and Markets Authority (CMA).

As part of the remedies agreed to secure CMA approval for the transaction, 15 convenience stores and two funeral homes across the combined estate will be divested.

When finalised, Southern Co-op’s 173 food sores and 70-plus Welcome franchise stores will join the Co-operative Group’s 2,300 food store estate. Both businesses will continue to operate as normal while detailed migration plans are finalised, there are no immediate changes planned to membership benefits or rewards.

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The merger was first announced in April and voted on by Southern Co-op members in May. Members were cautioned that if the merger doesn’t take place, the future of Southern Co-op was at risk given losses suffered over the preceding three years.

Southern Co-op had also been approached by OurCoop, made up of the former Central, Midcounties and Chelmsford Co-operative, suggesting that there was “real potential for our Societies to build on our existing relationship – on membership, on campaigning, on community programmes – in ways that would benefit the members of both our Societies and the communities we serve alongside one another”.

However, it was not seen as a “solvent alternative”.

Commenting on the CMA’s decision, Kate Allum, interim CEO of The Co-operative Group, said: “Today is a significant moment for our two societies and the wider co-operative movement. CMA approval gives us the green light to begin an exciting new chapter of co-operation.

“By bringing together more than 300 years of co-operative heritage, we have the opportunity to build an even stronger Co-op, with greater scale and resilience, and the ability to deliver more for our members, customers and communities.”

Ben Stimson, CEO of Southern Co-op, added: “We can now build on Southern Co-op’s achievements and take the strengths of our business forward into the next chapter. I’d like to thank colleagues and members for their continued support. Our priority is to maintain our shared values and strengthen the co-operative movement as we join forces in earnest. We’ll keep supporting our colleagues and serving our customers and clients brilliantly through the transition.”