For Immediate Release
May 13th, 2015
(Moncton) – The member-owners of Co-op Atlantic have voted in favour of exiting the food and gas wholesale and retail business. The vote follows a recommendation from the Board of Directors on April 25th for the organization to exit the business and divest of its assets.
The result of the vote will allow Co-op Atlantic to proceed with a proposed agreement with Sobeys for the purchase of the food and gas related assets.
"With the member-owners voting in favour of the Board's recommendation we will now proceed with finalizing the proposed purchase and sale agreement with Sobeys and begin the transition of exiting the food and gas wholesale and retail business," says Co-op Atlantic Interim CEO Bryan Inglis. "This decision by member-owners is the best option to ensure the long-term viability of the close to 60 independently owned co-op member stores across the region. Now those independently owned stores will be able to find a new wholesaler to provide products," says Inglis. "We know that Sobeys has been meeting with each of these stores to potentially enter into a wholesale agreement."
The proposed sale of assets to Sobeys would see Sobeys purchase the majority of the corporate food and gas retail sites and wholesale assets only.
Each of the independently owned co-op member stores will remain co-operatives – owned by their members in each of the communities in which they are located across the region.
The decision to exit the food and gas business will have an impact on employment at Co-op Atlantic. How many positions will be affected and the timing of that impact will be determined following the completion of the proposed purchase and sales agreement.
"This is the toughest aspect of the accepted recommendation by member-owners," says Inglis. "While the transition will take some time, we will be working with affected employees, providing them with counseling and resource services to assist them in finding a new opportunity."
Co-op Atlantic is now currently conducting a full review of the other lines of business including agriculture, petroleum and housing. Once those reviews are complete, the organization will be in a better position to determine next steps for those divisions.
The completion of the proposed purchase and sales agreement and the exit from the food and gas business is expected to take a number of months to complete.