This article is from the source 'bbc' and was first published or seen on . It will not be checked again for changes.

You can find the current article at its original source at http://news.bbc.co.uk/go/rss/-/1/hi/business/7508982.stm

The article has changed 6 times. There is an RSS feed of changes available.

Version 1 Version 2
Co-op buys Somerfield for £1.57bn Co-op buys Somerfield for £1.57bn
(about 1 hour later)
The Co-operative Group (Co-op), the UK's fifth largest supermarket chain, has agreed to buy rival Somerfield.The Co-operative Group (Co-op), the UK's fifth largest supermarket chain, has agreed to buy rival Somerfield.
The Co-Op said the £1.57bn ($3.1bn) purchase would strengthen its position in the UK retail market. The Co-op said the £1.57bn ($3.1bn) purchase would strengthen its position in the UK retail market.
Manchester-based Co-op, a mutual outfit run on behalf of its 2.5 million members, also said the deal was done on a cash-free and debt-free basis.Manchester-based Co-op, a mutual outfit run on behalf of its 2.5 million members, also said the deal was done on a cash-free and debt-free basis.
With more than 4,300 UK retail outlets, it employs 85,000 people. Bristol-based Somerfield has about 900 stores.With more than 4,300 UK retail outlets, it employs 85,000 people. Bristol-based Somerfield has about 900 stores.
The latest figures from research firm TNS, show that in the 12 weeks to the middle of June, the Co-op had 4.4% of the UK grocery market, and Somerfield 3.7%.The latest figures from research firm TNS, show that in the 12 weeks to the middle of June, the Co-op had 4.4% of the UK grocery market, and Somerfield 3.7%.
Stores sell-off?Stores sell-off?
Somerfield is owned by a consortium that includes private equity firm Apex, Barclays Capital and property magnate Robert Tchenguiz.Somerfield is owned by a consortium that includes private equity firm Apex, Barclays Capital and property magnate Robert Tchenguiz.
Supermarket share Tesco: 31.2%Asda: 16.8%Sainsbury's: 15.9%Morrisons: 11.4%Total Co-ops: 4.2%Waitrose: 3.9%Somerfield: 3.7%Aldi: 2.9%Lidl: 2.3%Iceland: 1.7%Netto: 0.6%Farm Foods: 0.5% Source: TNSSupermarket share Tesco: 31.2%Asda: 16.8%Sainsbury's: 15.9%Morrisons: 11.4%Total Co-ops: 4.2%Waitrose: 3.9%Somerfield: 3.7%Aldi: 2.9%Lidl: 2.3%Iceland: 1.7%Netto: 0.6%Farm Foods: 0.5% Source: TNS
They bought the chain for about £1.1bn three years ago.They bought the chain for about £1.1bn three years ago.
Somerfield was put up for sale in January and the Co-op first expressed an interest in a possible purchase in April.Somerfield was put up for sale in January and the Co-op first expressed an interest in a possible purchase in April.
The Co-op may now look to sell some of the stores it has purchased, with Morrisons, Waitrose and Iceland touted as potentially interested parties. The Co-op may now be told by competition watchdogs to sell some of the stores it has purchased, with Morrisons, Waitrose and Iceland touted as potentially interested parties.
Co-op chief executive Peter Marks says Somerfield's acquisition will provide "rocket fuel" for his group's growth plans.Co-op chief executive Peter Marks says Somerfield's acquisition will provide "rocket fuel" for his group's growth plans.
Profits target
Mr Marks said the deal, which is subject to regulatory approval, would "create a stronger fifth player in food and a convenience store chain with unrivalled geographic reach". Somerfield facts Founded as JH Mills in 1875Renamed Gateway in 1950Renamed Somerfield in 1994Floated on stock market in 1996
In April, the Co-op said it would spend £1.5bn to revamp its business and lift its fortunes, after 2007 profits fell 46% to £195.5m.In April, the Co-op said it would spend £1.5bn to revamp its business and lift its fortunes, after 2007 profits fell 46% to £195.5m.
The firm also said then that it aimed to double its profits over the next three years.The firm also said then that it aimed to double its profits over the next three years.
It expanded in July 2007 when it merged with fellow mutual United Co-operatives.It expanded in July 2007 when it merged with fellow mutual United Co-operatives.