Co-op Group tables £140m bid for Nisa as Sainsbury's pauses takeover talks
The Co-op Group has entered into exclusive talks to acquire convenience store operator Nisa, replacing Sainsbury's as the front-runner in the process.
The Co-op is thought to have tabled a £140 million bid for Nisa, whose 1,300 shopkeeper members run 3,000 stores.
"We can confirm that we've entered into a period of exclusivity with Nisa, which will provide the opportunity for us to carry out more detailed due diligence in the coming weeks.
"Following this period and subject to approval from our board, we hope to be in a position where we can put forward an offer to Nisa members," the Co-op said in a statement.
It comes after Sainsbury's, which is under pressure to respond to Tesco's £3.7 billion merger with wholesaler Booker, is thought to have paused takeover talks with Nisa.
The supermarket giant is understood to be awaiting the findings of a Competition and Markets Authority (CMA) probe into the Tesco-Booker deal before it makes its next move.
Details of the Co-op talks were also shared with Nisa members by the group's chairman, Peter Hartley.
He said: "The board of Nisa has held a number of positive discussions with the Co-op in recent weeks, following its reaffirmation of interest in making an offer for your company.
"Your board has granted the Co-op a period of exclusive due diligence from today.
"Thereafter, and subject to the results of the due diligence, it is anticipated that the Co-op could be in a position to make a final offer to the members for your consideration.
"Should an offer of merit emerge from this process, it will be for you, the members, to decide on whether to accept it.
"As you are all aware, our business and the convenience sector continue to evolve at pace and the board of Nisa will continue to review serious queries and offers which emerge."
Nisa, which recently completed a £120 million refinancing, has struck a number of new contract wins recently as a turnaround plan under boss Nick Read begins to bear fruit.
Britain's crowded grocery market is poised for a wave of consolidation.
Tesco's potential merger with Booker, Amazon's foray into the sector with the acquisition of Whole Foods and the continued rise of Aldi and Lidl has put the supermarket sector in a state of flux.