Co-operative Group Limited (“Co-op” or the “Group”) has successfully priced its bond offering of £350 million (the “Offering”) in aggregate principal amount of 8.25% sustainability senior notes due 2031 (the “Notes”).
The Offering is a leverage-neutral refinancing transaction aimed at proactively extending the Group’s debt maturity profile and maintaining headroom to support Co-op’s future planning.
If completed, the net proceeds of the Offering are expected to be used to redeem the Group’s existing £350 million aggregate principal amount of senior notes due July 2026 at maturity.
In recent years, Co-op has strengthened its balance sheet, enabling the business to manage a criminal cyber-attack in 2025 without additional funding. The Offering forms part of the Group’s long-term planning; by 2030, Co-op has ambitions to reach 10 million active members, up from its previous target of 8 million. It has also announced a proposal to join forces with Southern Co-op, acquiring 300 outlets and 300,000 members if completed.
Chief Financial Officer, Rachel Izzard, said of the transaction:
“Our Co-op is more than 180 years old, and now we’re strengthening it for the next 180. By refinancing bond debt, we’re maintaining our financial resilience and widening our options, so we can keep sharing value with members, colleagues and communities in the years ahead.”
Under a Sustainable Bond Framework, Co-op is linking the bond to projects that can deliver clear environmental or social benefits, including its spend with Fairtrade suppliers and on-site renewable energy generation. In research conducted this month, ‘sustainable food supply chains’ ranked as the top matter that surveyed Co-op members would most like business to act on, with ‘sustainable use of resources’ coming second.*
Further detail
The Notes are expected to be guaranteed on a pari passu basis with the Group’s existing term loan and revolving credit facility.
The Notes are expected to be issued at par on or about 11 June 2026, subject to customary conditions precedent. The Notes are expected to be listed and admitted to trading on the Official List of The International Stock Exchange.
