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The Co-op has sold a number of property assets to restructuring group Hilco as the group seeks to cut debt and bolster its grocery business after a near collapse in 2013.

The retailer – Britain’s biggest mutual – has said it will dispose of 36 stores bought as part of its acquisition of Somerfield, the supermarket chain, in 2008. It will also sell around 50 “non-core” properties comprising former stores and office spaces, according to a spokesperson.

The group said it will focus on its convenience store business after a dismal set of results for 2015 that saw profits almost entirely wiped out amid heavy discounting in its supermarkets.

Steve Murrells, chief executive of its food division, said:

The Co-op Food business is moving forwards with a clear purpose and momentum, so we can deliver a compelling, convenient and co-operative shopping experience for millions of shoppers each day.

It is essential that we have a proactive property programme in place to support our long-term growth strategy and this sale aligns with that approach.

Chief executive Richard Pennycook agreed to an almost 60 per cent pay cut after the results earlier this year.

The sale of stores to Hilco is expected to be completed in July and the group said that it will “recognise a profit” – though kept the terms of the deal confidential. It said that all 920 employees would continue in their jobs after the sale as the properties continue to trade as food stores.

Copyright The Financial Times Limited 2017. All rights reserved.
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