Co-operative Farms sells for £249m to charitable trust

A charitable trust has purchased the Co-operative Group’s farming division for £249m. Health charity the Wellcome Trust has acquired Co-operative Farms and comes just two weeks after the...

A charitable trust has purchased the Co-operative Group’s farming division for £249m.

Health charity the Wellcome Trust has acquired Co-operative Farms and comes just two weeks after the Group announced the sale of its pharmacy holdings to wholesaler Bestway for £620m.

Intentions to sell both businesses was made earlier this year as part of the Group’s decision to focus on food, funerals, general insurance and legal services. Proceeds will be used to reduce the organisation’s debt, which at the end of the 2013 financial year stood at £1.4bn.

“In the Wellcome Trust we have a buyer whose values are closely aligned to those of the Co-operative,” said the Group’s interim chief executive Richard Pennycook. “They have a proven track record in managing a sustainable investment portfolio, the proceeds of which are used to fund improvements in biomedical science and learning.”

The trust, which is backed by a £16.5bn endowment, focuses on the development of human and animal health. It funded research behind the sequencing of the human genetic code, and it spends more than £700m a year in supporting biomedical research and humanities and social sciences.

Danny Truell, chief investment officer at the trust, said: “We believe that we are ideally placed to develop and grow the Co-operative Group’s farms and farm business while providing continuity, and are delighted to have acquired them in what will be one of the largest global deals of its kind.

“The trust’s philosophy is to provide long-term investment for the businesses and property we hold in good times and in bad. We will take this approach to running Farmcare Trading Ltd as a going concern, giving a business that is already strong and successful the support and resources it needs to grow, to the benefit of employees, tenants, partners and local communities.”

Included in the sale is 15,997 hectares of freehold and third party-owned land across 15 farms, including three pack houses. Also included is over 100 residential and 27 commercial properties. The trust will also maintain existing services for communities, such as the Farm to Fork educational programme for children.

Mr Pennycook added: “The Wellcome Trust has acquired an excellent farming business characterised by the quality and professionalism of colleagues and high levels of customer service. I expect the farming business to continue to thrive under their committed long-term ownership.”

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