Nisa-Today's members will need to get involved in some deep discussions about the future of the group following the collapse of the Costcutter merger, according to chief operating officer Neil Turton.
The merger plan was scrapped last month when the consortium of banks backing the deal imposed new conditions following the complaint sent to the Office of Fair Trading by the Nisa Members Association (NMA), alleging that Nisa and Costcutter acted as a cartel in recruiting members.
A proven cartel offence could lead to a maximum fine of 10% of a company's turnover - which in Nisa's case could be as much as £100m. With this in mind, banks involved in the deal wanted to set aside funds to cover any adverse ruling and charge Nisa interest, meaning that the board would no longer be able to guarantee that prices for members would not rise as a result of the deal.
Nisa has always denied the cartel allegations, and an internal committee of four retail members found no evidence of any cartel offence in a recent investigation, although it did find evidence of non-solicitation agreements. Nisa has to date still had no formal request for information from the OFT.
"It's disappointing that an allegation of anti-competitive behaviour has caused us to shelve an initiative that would have made us more competitive," Turton told C-Store.
"It's frustrating that members have been denied the chance to vote on what I still say was the right deal, which would have brought benefits to thousands of businesses. But, of course, they still could have voted against it, and that is effectively the situation we are in now."
Discussions about the future - which could include trading alliances with other organisations - won't begin in earnest until the new year, as Turton is anxious not to disrupt Christmas trading.
"We want to give members a clear Christmas, concentrate on the operational side and let the dust settle," he said. "We could have soldiered on, delayed the vote or pulled back altogether, but we have to accept that the terms have changed substantially and we were up against hard deadlines.
"We are faced with the fact that in our current form it is difficult for Nisa-Today's to be successful," Turton continued. "We are high turnover but low profit; we have spare capacity in the supply chain but we don't have the available funds to buy even a single store. For now, we will have to try and grow through recruitment and will have to explore alliances. But it is the job of the management to find solutions as well as point out the problems, so we will be working with the members to see if we can find a new direction for Nisa."

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