Co-op joins grocery price battle

Mon 30 Nov, 2009 00:07

LONDON (Reuters) - The Co-operative Group announced price cuts and promotions Monday which it said were worth 200 million pounds as it joined the battle among supermarkets to lure Christmas shoppers.

Britain's fifth biggest food retailer said Monday its offers would include its first ever triple dividend payment.

Normally Co-op members earn one point for every pound spent in food stores and each year the value of a membership point is determined by how much profit the group makes.

For the last annual payment, the value of a point was set at 2 pence. On this basis, a triple dividend would be worth 6 pence in the pound.

The investment is the latest sign of competition heating up among supermarkets in the run up to Christmas.

Tesco, Britain's biggest retailer, said earlier this month it was undertaking price cuts and promotions that would save shoppers 250 million pounds, while rival Asda forecast the most competitive Christmas for a decade.

Other retailers, however, expect less discounting and promotional activity compared with last year as stock levels are much lower than in the run-up to last Christmas.

(Reporting by Mark Potter; Editing by Greg Mahlich and Toby Chopra)