The Co-operative Group  has agreed to sell its pharmacies to Sir Anwar Pervez’s Bestway in a deal valuing the health specialist at £620m.

The disposal represents a step forward in the Co-op’s efforts to refocus following the banking scandals and in-fighting that threatened to destroy the mutual.

The cash raised will be used to cut the Co-op’s debt and invest in its core food retail business.

Bestway, the UK’s 18th biggest privately owned company and the second largest independent wholesaler, had already emerged as the frontrunner to buy The Co-operative Pharmacy.

The Co-operative pharmacy is the UK’s third largest pharmacist. It has approximately 770 branches and last year generated an operating profit of £33m on sales of £760m.

The Co-op will provide “certain services” to the pharmacy business for up to 18 months under a transitional services agreement. Bestway will have the right to operate under the Co-operative Pharmacy brand for a transitional period of 12 months.

Co-operative Group interim chief executive Richard Pennycook said: “The successful sale of our Pharmacy business is an important move.

“The proceeds will enable the Co-operative to reduce debt and invest in our business and is part of the focused delivery of our clear strategic plans and priorities.

Bestway Group chief executive Zameer M Choudrey said: “The Co-operative Pharmacy is a strong, competitive business, operating in a sector where demographic trends show an increasing demand for healthcare services amongst the wider community.

“We see great potential to grow the business organically and through future acquisitions. We always look to take a long-term approach and have a strong track record of successfully growing businesses that have previously been acquired within the group. We are confident that we will continue to do so with this business.“