Peter Marks, CEO of The Co-op Group, confirmed the society was in serious discussions with Somerfield. It was currently carrying out due diligence, but there was no certainty that a transaction would proceed.
A deal could be finalised by the summer, he added.
Meanwhile, The Co-op Group's food business has reported a 50.5% increase in pre-tax profit on sales up 21% at £3.68bn for the year to 12 January.
The results were boosted by the society's merger with United Co-operatives last year, as well as an ongoing £200m store refurbishment programme.
“In our core food business the momentum generated during 2007 has continued into 2008 with strong like-for-like sales in the first three months,” Marks added. “We expect this to continue throughout the year, boosted by the rebranding programme, which is generating significant sales uplift.”