Hundreds of convenience stores could soon come under new ownership after members of Southern Co-op overwhelmingly backed a rescue merger with the national Co-op Group amid warnings the regional retailer risked collapse without a deal.
Members voted by 97.07 per cent in favour of transferring the society’s operations to a subsidiary of the national Co-op Group during a Special General Meeting held on Tuesday, marking a major step towards one of the biggest shake-ups in the convenience retail sector in recent years.
The proposed agreement would see almost 200 convenience supermarkets change hands, alongside funeral homes and coffee outlets operated by Southern Co-op across southern England.
If approved in a second and final ballot, more than 300 sites would become part of the national chain, creating a combined organisation with annual sales of roughly £11.5 billion and close to 2,500 stores nationwide.
A Southern Co-op spokesman confirmed the result after the vote, which attracted more than 13,000 ballots from members.
“At the Special General Meeting of Southern Co-operative Limited held on 6th May, Southern Co-op Members voted in favour of the Special Resolution to transfer the engagements of the Society to a subsidiary of The Co-operative Group,” the spokesman said.
The result represents a crucial milestone for the transaction, although the merger still requires formal approval in a further member vote before it can proceed.
The move comes after months of mounting financial pressure on Southern Co-op, which has struggled with rising operating costs, weak consumer spending and declining profitability in an increasingly competitive grocery market.
Ben Stimson, the society’s chief executive, had warned ahead of the ballot that failure to approve the merger could leave the business facing widespread closures and possible administration.
Stimson said: “By coming together, we can secure the co-operative future of Southern Co-op as part of a stronger combined Co-op Group, whilst creating an even stronger voice nationally and internationally to advance the co-operative cause.
He said the agreement offered the best route to secure the long-term future of the retailer and protect jobs across its estate.
Southern Co-op has been grappling with unsustainable losses and difficult trading conditions for several years, reflecting wider pressures across Britain’s convenience retail sector, where smaller regional operators have struggled to compete against rising energy bills, wage costs and intense price competition from larger supermarket chains.
A Southern Co-op spokesperson emphasised the importance of continued participation: “While the outcome of the first vote is encouraging, the 2nd resolution vote is equally critical and we welcome our members’ continued support and engagement.
The merger would significantly strengthen the national Co-op Group’s presence across southern England while preserving many of the stores under the broader co-operative model.
The Co-op Group has increasingly focused on expanding its convenience store footprint as larger supermarkets battle for dominance in local shopping markets, particularly as consumers shift towards smaller, more frequent grocery trips.
Industry analysts said the scale of member support suggested many viewed the merger less as a strategic expansion and more as a necessary rescue operation for a retailer under growing financial strain.
For customers, most stores are expected to continue trading with minimal immediate disruption should the deal complete, although branding and operational changes are likely over time.
The final decision will now rest on a second vote expected later this year, which will determine whether one of Britain’s oldest regional co-operatives formally becomes part of the national organisation.
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