Fylde Co-Op stores sold to retail rival
Six Fylde coast local Co-Op stores are among a raft of 300 being sold to a rival retail company.
But staff have been told that they will transfer to new owners McColl’s under the same terms and conditions and jobs will not be lost in the short term.
The £117m deal has to be ratified by regulators and McColl’s shareholders, but it will see 3,808 Co-op staff transferred to McColl’s as part of a TUPE agreement.
The Fylde stores which are set to transfer are the ones at Coronation Street, Central Drive, Preston Old Road and Harrowside in Blackpool, plus the stores at Staining and Warton.
The Co-op said it was selling the stores, which are 1,700 sq ft on average, because they are too small to stock all of its own-brand products which have been key to driving up sales.
It said the move tied in with plans to grow the total number of Co-op members to a million by 2018, while pushing up the total sales from members to 50 per cent.
The mutual said like-for-like sales growth in its convenience estate hit 4 per cent in the year to April, while like-for-sales across its food stores in the 52 weeks to January 2 rose by 1.6 per cent. McColl’s, which has 933 convenience stores, said the cash deal for the stores would be part funded by raising around £13.1m from placing 10.5m shares to new and existing investors.
Jonathan Miller, chief executive of McColl’s, said the acquisition of the new stores would “substantially” accelerate its growth strategy. He added: “These stores are profitable, well invested, and the perfect size for our operating model. ”
Steve Murrells, Co-Op’s chief executive said: “Today’s announcement is completely in line with our strategy, as these stores did not allow us to provide a sufficiently compelling own-brand offer for our members going forwards.
“The proceeds will be re-invested to drive sustainable growth for our members and I’m delighted that all 3,808 colleagues will transfer to McColl’s on the same terms and conditions.”
Shop workers’ union USDAW said it was monitoring the move. John Gorle, Usdaw National Officer said: “We welcome the Co-op’s assurances that terms and conditions of employment will be safeguarded and staff will continue to have secure jobs with a future.”