SuperValu and Unified Grocers announced this week that they have reached a definitive merger agreement; under the terms disclosed, SuperValu will acquire 100 percent of the outstanding stock for Unified Grocers for $114 million in cash and the assumption of approximately $261 million in debt—for a combined $375 million.
“We’re thrilled at the opportunity to bring together these two great organizations,” said Mark Gross, President and CEO of SuperValu, in a company press release. “By acquiring the Unified business, including gaining a wealth of expertise and talent, we will become a stronger and more efficient organization. The transaction will enhance our ability to help our customers better compete in the evolving grocery industry.”
The deal will bring together the two companies’ highly complementary grocery wholesale organizations—with combined sales of approximately $16 billion in 2016. Together, SuperValu and Unified operate 24 distribution centers supplying customers in 46 states and serve a combined customer base of over 3,000 stores.
“We believe this transaction will benefit the Members and customers of Unified Grocers as they look for new and innovative ways to serve the communities in which they operate,” said Unified Grocers President and CEO, Bob Ling. “SuperValu and Unified share a common vision of providing best-in-class services and products to the independent grocer. The cultural fit between SuperValu and Unified well positions the combined company to pursue a shared dedication and commitment to growth and innovation, providing increased value to customers.”
The newly-merged company, the press release notes, will be uniquely positioned to serve a broad range of independent customers, offer a diverse array of value-added services, and help customers more efficiently compete in an increasingly demanding grocery environment.
“We’re also excited to serve Unified’s dynamic retailer base,” said Gross. “Unified’s members and customers operate some of the country’s most exciting and progressive Hispanic and multiple other ethnic formats, specialty, gourmet, natural/organic, price impact and traditional stores. They complement our existing customer base and we look forward to facilitating collaboration and innovation across such an impressive collection of creative merchants.”
The acquisition will provide new growth opportunities across the country, including the expansion of Unified’s Market Centre division, a growing business providing specialty and ethnic products to independent customers.
“We appreciate the experience, intelligence and dedication of the Unified team, and look forward to welcoming Unified associates to SuperValu and supporting them as we continue the important work of contributing to the growth and success of our customer network and helping to deliver value to our stockholders,” Gross added. “We will make a great team together.”
Deli Market News will bring you updates on this and other important acquisitions in our industry as they occur.