Coop amba and energy company OK have agreed on a 50/50 ownership structure for Coop Danmark, with OK having ‘decisive influence’ over the grocery chain, regardless of ownership shares, the company noted in a statement.
As part of the agreement, Coop amba and OK will invest DKK 2 billion (€270 million) in Coop Danmark, to help the grocery chain strengthen its SuperBrugsen, Kvickly, Brugsen and 365discount banners.
Coop amba, the association behind Coop Danmark, will sell part of its assets, including Coop Bank, to inject money into Coop Danmark.
‘The Right Partner’
The CEO of Coop Danmark, Kræn Østergaard Nielsen, said, “With OK, Coop Danmark has found the right partner. We both have roots in the cooperative movement, and we already collaborate around OK’s fuel and electric-charging stations. In addition, OK comes with strong competencies in grocery retailing.”
The agreement includes provisions to introduce simpler decision-making processes in Coop Danmark, so that the ability to change and develop the company is accelerated.
Michael Løve, CEO of OK, said, “The agreement ensures peace of mind about Coop Danmark’s finances. [...] We believe that the capital injection and the partnership can contribute to Coop Danmark finding its core in running a healthy grocery business centred on the classic and strong Coop brands.”
New Board Structure
A new board will also be elected and take office when Coop amba’s national council and the competition authorities approve the deal, the company noted.
Jeff Gravenhorst will continue as chairperson, while Løve will take over as deputy chairperson.
In addition, the board will comprise the CFO of OK, Thor Skov Jørgensen, and two members of Coop amba’s board, who will be elected at the beginning of May.
The board will also have four employee representatives as members, in addition to two other members appointed by OK.
“The board will be given significant capabilities within the grocery trade, and thus Coop Danmark will have a board that can drive the turnaround the business will have to go through in the coming years,” Gravenhorst added.
Other Changes
The deal also creates the provision for a new banking agreement with the four banks that form part of Coop Danmark’s existing banking syndicate.
The roll-out of new grocery stores under the name of the Coop chain will be discontinued as part of the focus on the core business and existing brands.
Østergaard Nielsen has announced plans to resign from the role of CEO as soon as the agreement is in place.
Elsewhere, Gravenhorst will serve as acting chairman of the board until the appointment of a new CEO.
