Co-op clinches Nisa takeover

The Co-op has secured the £143m takeover of Nisa.

 

The 75 per cent margin needed to finalise the deal was narrowly achieved by a margin of 75.8 per cent to 24.2 per cent. More than 80 per cent of individual shareholder members approved the transaction.

The offer requires clearance from the Competition and Markets Authority, which is expected around the end of March next year.

After a series of bellicose meetings between shareholders threw the deal into disarray, there was a sense of relief at Leeds United Elland Road stadium, where the vote was held.

Nisa chairman Peter Hartley said: “We are delighted that our members have chosen in such significant numbers to vote in favour of Co-op’s offer. We as a Board are firm in our belief that a combination with the Co-op is in the best interest of Nisa’s members. The convenience store environment is changing rapidly, and is unrecognisable from that which existed when Nisa was founded more than 40 years ago. Co-op will add buying power and product range to our offering, while respecting our culture of independence.”

However Molly Johnson-Jones, a senior analyst at GlobalData Retail says the vote reflected the discontent which has plagued the deal since it was brought forth earlier this year.

Ms Johnson-Jones said: “Shareholders were unhappy that with the initial £20,000 pay-outs, smaller shareholders were favoured, and that the deal did not hold everyone’s interests equal,” she said.

“Many independent retailers are fearful of what the market consolidation will do to their autonomy, and there was dissidence around the idea of being owned by a large corporation.”

With the Tesco-Booker merger hanging like a spectre over the retail industry, Nisa’s vote will be seen as a pragmatic measure, gauged at consolidating their position in a time of insecurity. Ms Johnson Jones believes the deal was “necessary to futureproof the business.”

“Nisa will be more able to protect its independent retailers now. Although the franchise model does not require shopkeepers to buy any particular products, the option of being able to obtain lower-price products with Co-op’s buying scale will mean there will be less pressure on gross margins”, Ms Johnson-Jones concluded.

 

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