The Co-operative Group is locked in talks to buy fellow UK convenience retailer Somerfield, just-food understands.
Negotiations between the two companies have begun after the Co-op emerged as the only potential suitor to table a formal bid for Somerfield, which runs over 900 stores in the UK.
A source familiar with the situation told just-food today (2 April) that takeover talks had started although the two sides had yet to agree on a price.
Somerfield’s owners, a consortium that includes property tycoon Robert Tchenguiz, Barclays Capital and Apax Partners , put the business up for sale in January and was understood to be looking for up to GBP2.5bn (US$4.9bn) for the chain.
The consortium bought the UK’s fifth-largest grocer for GBP1.8bn two years ago.
A spokesman for the Co-op refused to be drawn on whether the retailer had any interest in Somerfield.
The Co-op is looking to expand through acquisitions but is focusing on bedding down last year’s merger with United Co-operatives.
Officials at Somerfield could not be reached for immediate comment while members of the consortium behind the business declined to comment.