The Co-operative Group could be a player in the bidding war for 955-strong store chain Somerfield, which put itself up for auction last week. 

Somerfield, which was bought by a consortium of shareholders including property magnate Robert Tchenguiz, Barclays Capital, Apax and Kaupthing Bank for £1.8bn two years ago, is said to have appointed investment bank 

Citigroup to lead the auction. Reports suggest that the chain could sell for as much as £2.5bn.
The Co-operative Group, which recently unveiled record sales for the festive trading period, has made no secret of its intention to expand its retail empire. A spokesman for the Co-operative Group said: "It is no secret that the group is looking to grow its business by acquisition. If an appropriate opportunity arose we may well look at the business [Somerfield]," he said.

An industry insider told C-Store that Somerfield would be a good fit for the Co-operative Group, saying: "It wouldn't surprise me if they were to put in a bid as Somerfield's store sizes would suit them well." 

Asda, Sainsbury's and frozen food retailer Iceland are also in the frame, although Tesco is expected to wait until the Competition Commission has published its grocery market report before considering any bid.