Alldays' stock, once trading at over Â£6, this week plunged to just 5p, valuing the company at a mere Â£2.2m: Bargain. The only stumbling block was the estimated Â£190m albatross of debt which has sent predators running for cover, pushed respectable enough figures into the red, and forced management to operate the business with its hands tied behind its back.
This week, however, the banks finally cut their losses, wrote off an estimated Â£60m in debt, and pulled Alldays off the shelf and into the arms of its biggest admirer.
Around Â£131m to banks and Â£2.2m to shareholders later, the Co-operative Group is the proud owner of more than 600 new stores, taking its food retail estate to around 1,700 stores with a turnover topping Â£3bn. "Five years ago," says Malcolm Hepworth, Co-operative Group chief operating officer, retail, "we said it was our intention to be the market leader in top-up. Well, we've done it."
But the task ahead is formidable. To see a return on its investment, and Hepworth is convinced he can generate a 20% sales uplift at the new stores, the society will have to refurbish the entire Alldays estate at breakneck speed and substantial cost. But Hepworth has every right to feel confident. Not only does the Co-operative Group boast a c-store concept generating unrivalled sales per square foot in the sector, it has just successfully pulled off one of the biggest mergers in UK food retail in recent history Â the merger of CWS and CRS Â and come out the other end smiling.
Profitability in food retailing has almost doubled following the merger and like-for-like sales at its Welcome c-stores are running at 7% Â well ahead of the market. And now, with Alldays, Hepworth says: "I'm expecting sales growth in excess of 20% through an aggressive refurbishment programme of two to three years." Pause to do the sums and that equates to between four and six refurbs a week for the 600 fully owned Alldays stores Â or a refurb every 29-44 hours.
Having said that, refurbs to the new Welcome and Market Town formats have been running at up to 10 a week, and months of finetuning the process mean the Alldays exercise could probably be planned with military precision. There are no plans to rush into anything in terms of buying, IT systems, logistics, store ranging, branding and disposals, he insists.
"We're giving ourselves three months to sit down and co-ordinate workstreams to work out exactly how integration will work. We want to stabilise day-to-day activities and see where the synergies are." Alldays' strengths are in news, drinks and tobacco, he explains. "Ours are in fresh, chilled and ambient groceries.There is no doubt we can add value to the mix."
While the society would never seek to hide its co-operative identity, the Alldays name may not necessarily disappear, he speculates. "I'm leaving my options open."
Clearly, one key synergy would be bringing Alldays' purchasing within CRTG. With well over half a billion in sales, and potentially much more with a strong investment programme, the extra leverage from Alldays would undoubtedly give CRTG more clout.
There will also be opportunities for suppliers to pitch for more business with CRTG, adds Hepworth.
"Suppliers should see this as a fantastic opportunity to put a deal on the table that gets them access to CRTG."
When it comes to possible sell-offs, which observers suggest is inevitable given the geographical overlap of some of the stores and the size of some of the others, Hepworth is reticent. But this should not be seen as evidence that a mass sell-off is on the cards,he stresses. "We bought this business to grow our convenience portfolio."
Contrary to popular belief, points out Hepworth, perhaps just 50 or 60 of Alldays' stores are under 1,000 sq ft. And the Co-op Group is more than capable of trading successfully from stores of that size.
Indeed, a new Co-operative Group small store format, specifically targeting smaller Alldays stores in suburban areas of the south east, will be explored in the coming months, says Hepworth.
As for overlap, he is sanguine. "Obviously, with an acquisition of this size with national coverage, there will be overlap, but because of the small catchments you can trade very successfully with stores very close by. There are literally just a handful of locations where this could be a problem."
The only immediate departures from Alldays are chairman Alan Cole and two non executive directors.
Alldays chief executive Stuart Lawson will remain at the helm running day to day issues during the transition, while Co-operative Group general manager, IT, Keith Brydon, will head the integration project as programme director.
The task ahead is tough, but the society's track record just has to inspire confidence, says Hepworth. "When you think of the merger of the CRS and the CWS, this was one of the only successful mergers in the retail business in the last 10 years. We've proved we can do it."