In a move designed to increase the availability of meal kits in its stores and position the retailer to lead the way in what it said is revolutionizing how families shop, prep, and cook their meals, The Kroger Co. has announced an agreement to acquire Home Chef—a transaction price of $200 million. And with future earnout payments of up to $500 million over five years, the total value of the transaction may reach as high as $700 million.
"Customers want convenience, simplicity, and a personalized food experience. Bringing Home Chef's innovative and exciting products and services to Kroger's customers will help make meal planning even easier and mealtime more delicious," said Yael Cosset, Kroger's Chief Digital Officer, in a press release. "This merger will introduce Kroger's 60 million shoppers to Home Chef, enhance our ship-to-home and subscription capabilities, and contribute to Restock Kroger."
The two companies noted, in a joint press release, that Home Chef meals are approachable, delicious, and fit a variety of taste preferences. Its offerings complement Kroger's Prep+Pared meal kits that are currently available in more than 525 stores.
"We've long believed that the future of our industry is omni-channel and bigger than just meal kits sold online,” Pat Vihtelic, Home Chef’s Founder and CEO, noted. “We want to be where our customers are and want to help make cooking at home easier, more accessible, and even more enjoyable. We're thrilled that we will be part of the Kroger family and plan to maintain our relentless focus on innovation that meets customers' evolving food needs. Kroger's expansive retail footprint will allow us to serve millions of more customers across the country with simple, convenient, and enjoyable meal solutions."
After the deal closes, Home Chef will operate as a subsidiary of Kroger, maintain its e-commerce business, and assume responsibility for Kroger's meal solutions portfolio. The company will continue to operate its offices and facilities. Following closing, Kroger will make Home Chef meal kits available to Kroger shoppers both in stores and online.
"As one of the fastest growing meal kit companies in the country, Home Chef is poised for even more explosive growth," added Cosset. "We admire their focus on the customer, culture of collaboration, dynamic experimentation, and demonstrated financial success. Home Chef's combination of culinary expertise and a customer data driven decision-making process is right in line with Kroger's vision to serve America through food inspiration and uplift by providing meal solutions for every lifestyle."
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