Co-op has revealed that Nisa retailers will receive £7m less than expected in shares and rebate payments, offered in return for the acquisition by the multiple.
The change, uncovered by Better Retailing, means the total to be given to Nisa stores has fallen by more than 5% to £130.5m.
At the previously agreed share value of £1,654, this is the equivalent of more than 4,200 shares being lost.
The multiple’s latest results stated: “The £7m credit in 2019 relates to a reduction in the amounts we are required to pay for the acquisition of Nisa, which is payable over a number of years depending on the trade passing through Nisa from its partners.”
Read more: Sales promised in Nisa rebate for Co-op own label
Under the deal agreed in 2017, Nisa retailers would receive their share payments split over three years, as well as an additional 1% rebate and £20,000 upfront payment.
Better Retailing understands stores that failed to hit buying targets based on previous purchasing would forfeit a proportionate amount of their share payments and rebates.
Stores that left Nisa or went under would forfeit the total amount.
Some Nisa retailers told Better Retailing they lost parts of their payments due to missing targets.
Better Retailing understands some Nisa stores may have entered liquidation.
Read more: Uncertainty around Co-op’s takeover of Nisa leaves retailers concerned
One store owner told Better Retailing: “The loyal Nisa members have suffered the most. Trading conditions and rising competition made achieving year-on-year growth tough for many.
“Stores buying from a mix of sources before the deal were able to increase the share they bought through Nisa to hit targets.
“This means those that were loyal to Nisa beforehand were most at risk.”
A source within the symbol group attributed the £7m to “a degree of shopping around” to boost margins and store owners leaving Nisa.
An official spokesperson for Nisa said: “Nisa partners approved Co-op’s takeover based on an initial payment, a deferred share payment payable over four years and additional rebates payable over four years.
“A small number are no longer partners and so Co-op’s deferred consideration provision has been revised accordingly.”
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