Co-op members back shake-up

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BOSSES at the Co-operative Group will be hoping to show that the troubled mutual is finally on the road to recovery when they deliver a trading update later this week.

The Co-op, which employs around 7,600 people in Yorkshire, is due to release its half year results on Thursday.

It slumped to a £2.5bn loss for 2013 after being dragged down by the near-collapse of its banking arm, when a £1.5bn hole was discovered in its balance sheet.

On Saturday, Co-operative Group members overwhelmingly endorsed a radical shake-up of its board structure, which followed a string of mistakes that brought Britain’s biggest mutual to its knees.

The Co-op Bank had to be rescued last year in a deal which saw bondholders, including US hedge funds, take majority control.

The group has been labouring under a £1bn-plus debt mountain, but moved to ease some of the burden in July when it announced it had sold its pharmacy stores for £620m in a deal with the company behind convenience shop brand Best-one.

A report by former City minister Lord Myners urged the Co-op group to embark on a series of radical changes.

At a special general meeting, which was held in Manchester on Saturday, 83 per cent of votes were cast in favour of proposals that aim to place the Co-op on a firmer financial footing.

Co-op chair Ursula Lidbetter said: “These reforms represent the final crucial step in delivering the change necessary to return the group to health.”

Co-operative Group was formed in 2007 from the merger of the Co-operative Group and United Co-operatives, The Leeds Co-op had voted to merge with United a few months earlier.

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