Tesco is buying the second largest convenience store group in the UK, T&S Stores, as part of a £377.3million deal. The chain operates the One Stop and Day & Nite names and runs 850 stores nationwide.

Under the deal, the supermarket will offer 2.2414 new Tesco shares for each T&S share held by investors. It plans to swtich 450 of the stores to its Tesco Express format and sell off the newsagents and discount stores in the T&S portfolio.

Meanwhile, the Co-op has become the largest convenience store retailer in the UK with the acquisition of the Alldays business from receivers this week.

The purchase cost the Co-op £131 million and complements its existing store profile. 'Until the acquisition we had 1,100 stores,' said a Co-op spokeswoman. 'Some 500 are supermarkets and 600 convenience stores. All of Alldays 600 stores are convenience stores and there is very little overlap for us in terms of location.' For the time being, the Co-op will be running the two businesses separately while it evaluates how best to integrate them and the likely impact on its fresh produce offer and procurement.

Alldays went into receivership and the sale was effected simultaneously on October 28: a very rare occurrence for a public company. It meant that Alldays shareholders were not given a chance to vote on the deal as shares in the company were suspended at 5p a share: they peaked in 1999 at 621.5p.

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