Case study: Co-operative Food

Last year, The Co-operative Group spent more than £1.5 billion to acquire supermarket rival Somerfield. In the words of The Co-operative’s Group Chief Executive, Peter Marks, the acquisition propelled the Group “from the second division back into the Premiership.”

Last year, The Co-operative Group spent more than £1.5 billion to acquire supermarket rival Somerfield. In the words of The Co-operative’s Group Chief Executive, Peter Marks, the acquisition propelled the Group “from the second division back into the Premiership.”

The Somerfield deal essentially doubled The Co-operative’s share of the UK supermarket sector from 4.5 percent to 8 percent, boosting its store portfolio to just under 3,000. In the words of Peter Marks, the acquisition was “rocket fuel for the business, a real transformational deal.”

Such an acquisition also entails challenges, not least to those charged with integrating the different systems and infrastructures within the two businesses. In recent years, there have been a number of acquisitions in the UK supermarket sector, and it is not unreasonable to say that some of these have been executed well, others less so. The Co-operative was determined from the get-go to manage the acquisition smoothly and efficiently. Commenting on the process, a retail analyst at Euromonitor said The Co-operative must have planned the integration of Somerfield “very, very well. The Co-operative seems to be doing all the right things in bedding Somerfield into the business.”

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