The Co-operative Group has completed the transfer of engagements of Southern Co-op, marking a significant step in the planned combination of the two co-operative societies, although the deal remains subject to approval by the Competition and Markets Authority (CMA).
Announced on Monday (27 July), the transfer sees Southern Co-op become part of a wholly owned subsidiary of The Co-operative Group, named Siena Co-operative Limited, while continuing to trade under the Southern Co-op brand.
The move follows approval from Southern Co-op members in May. However, both organisations will continue to operate independently while the CMA reviews the transaction, with a decision expected later this year. Integration plans will only progress if regulatory approval is granted.
The combined organisation would bring together Southern Co-op's network of 173 food stores, 83 Starbucks coffeehouses, 69 funeral homes, three crematoria, four burial grounds and 77 Welcome franchise stores, alongside The Co-operative Group's estate of more than 2,300 food stores, around 800 funeral homes, a wholesale business supplying approximately 8,000 outlets, as well as its legal services and insurance operations.
Together, the two societies would also represent more than 7.5 million members.
The Co-operative Group said the transfer marks “the start of an exciting new chapter of co-operation”, creating a larger organisation with greater scale and resilience while delivering increased value for members, customers, colleagues and communities.
Under Siena Co-operative Limited, Southern Co-op's food, funeral and Starbucks businesses will continue to operate as normal, with no immediate changes for members, employees, suppliers or local communities.
Kate Allum, interim chief executive of The Co-operative Group, said: “Today marks a historic milestone for both societies and the wider co-operative movement. By combining over 300 years of co-operative heritage, we are building a stronger future for members, customers and communities.
“Together, we can create more opportunities, deliver greater value, and drive the growth of co-operation across the UK for generations to come.”
Ben Stimson, chief executive of Southern Co-op, said the transfer represented “an important milestone” for the society.
“I'd like to thank our colleagues for everything they continue to do to support our members, customers and communities as we reach this point,” he said.
“As we take this next step, we're doing so alongside an organisation that shares our co-operative values and our commitment to making a positive difference in the communities we serve. Our organisations have worked together successfully for many years, including through the Federal Retail Trading Society (FRTS) buying and supply group and the wider co-operative movement, and today's announcement reflects the strength of that longstanding relationship.”