UK Competition Authority threatens probe of Co-operative Group's Southern Co-op takeover

The Competition and Markets Authority has raised concerns that the Co-operative Group’s intended purchase of rival Southern Co-op could significantly curb competition in the UK market. The regulator set a deadline of September 22 for the two mutuals to submit acceptable undertakings; failure to do so will lead to a formal phase-two investigation. The merger would bring Southern Co-op’s 330,000 members and about 300 sites—including food stores, funeral services and Starbucks coffeehouses—under the Co-operative Group’s umbrella of seven million members.

Although the financial terms have not been disclosed, both organisations continue to operate independently while the CMA review continues. They had originally aimed to finalize the transaction by the end of the year, pending member approval earlier in May. The outcome will determine whether the combined entity can proceed or must be altered to address competition worries.