Costcutter and the Co-op are poised to merge, with an announcement expected as early as tomorrow, retailers have told RN.

RN has understood since September that a merger is on the cards, with wholesalers Bestway and the Co-op seen as possible frontrunners.

A retailer, who did not want to be named, told RN he had been told by an industry insider that the deal is “a sure thing".

Another retailer, who first told RN about the deal, said: “The numbers didn’t add up on a Nisa/Costcutter merger so Costcutter have had to look to the Co-op.

“This is consolidation on a whole other level. Symbol groups are being forced into this by the Tesco and Booker deal – it is a seismic moment. If they don’t react they will be left behind.”

A senior industry source suggested the deal had been “on the grapevine” and would likely precipitate further deals including the sale of Palmer & Harvey.  

The news follows Nisa shareholders voting in favour of a Co-op takeover yesterday.

Co-op and Costcutter declined to comment.