The East of England Co-operative Society is to sell the majority of its non-food stores as it seeks to offload most of its department and home stores business to Vergo Retail.
The co-op is in negotiations to sell five department stores and six home stores. These stores represent less than 6 per cent of its business and the move will leave it with 134 food shops, alongside its funerals, travel, pharmacy, optical, motor dealerships and petrol forecourts businesses.
East of England Co-op chief executive Richard Samson said: “The decision to move away from non-food stores after so many years has not been an easy one to take.”
He added that the co-operative movement has in general “moved away from operating department stores and no longer has the scale of purchasing power it once had in this area of business”.
The deal will protect around 350 jobs at the stores concerned, four of which were threatened with closure until Vergo Retail revealed it was interested in buying them.
Vergo Retail – which recently bought the Plymouth & South West Co-operative Society’s Derrys department store in Plymouth and its Homemaker stores in Launceston, Plympton, Kingsteignton and Exmouth – is headed by former director of Mothercare, Habitat and Bhs David Thompson.
The East of England Co-op will continue to operate its online electricals shop and two of its small home stores not included in the deal will be incorporated into its adjacent food stores. In the first quarter of 2009 its food group showed a like-for-like sales increase of more than 5 per cent.