C(aryl)-OMe bond functionalization catalyzed by cobalt(II) chloride in combination with a nacnac-type ligand and magnesium as a reductant is reported. Borylation and benzoylation of aryl methoxides are demonstrated, and C(aryl)-SMe bond borylation can be achieved under similar conditions. This is the first example of achieving these transformations using cobalt catalysis. Mechanistic studies suggest that a Grignard reagent is generated as an intermediate in a rare example of a magnesiation via a C-O bond activation reaction. Indeed, an organomagnesium species could be directly observed by electrospray ionization mass spectroscopic analysis. Kinetic experiments indicate that a heterogeneous cobalt catalyst performs the C-O bond activation.