Grocers Kroger and Albertsons are selling more than 400 stores and other assets to C&S Wholesale Grocers in a deal worth about $1.9 billion as part of efforts to complete their merger.
The agreement includes the sale of 413 stores as well as the QFC, Mariano’s and Carrs brand names. Kroger will also divest its own brands Debi Lilly Design, Primo Taglio, Open Nature, ReadyMeals and Waterfront Bistro. In addition, C&S will receive eight distribution centers and two offices.
All gas stations and pharmacies associated with the sold branches will remain with the branches and continue to operate.
Kroger and Albertsons agreed to merge in October. Cincinnati, Ohio-based Kroger is offering $20 billion for Albertsons. Kroger would also assume $4.7 billion of Albertsons’ debt. The deal is expected to close early next year.
Before the deal with C&S closes, Kroger may require C&S to purchase up to 237 additional stores in certain regions in connection with securing Federal Trade Commission approval and other regulatory approvals. If additional stores are added to the agreement, C&S will pay Kroger an additional amount to be determined.
Founded in 1918, C&S supplies independent grocery stores and supplies more than 7,500 independent supermarkets, retail chains and military bases. The company currently operates Grand Union grocery stores and Piggly Wiggly franchise and company-owned stores in the Midwest and Carolinas.
C&S has experience with merger-related divestitures and has successfully transitioned union employees and associated collective bargaining agreements in the past.
“In our agreement, C&S is committed primarily to honoring all collective bargaining agreements that include industry-leading benefits, retaining frontline employees and continuing to invest for growth,” Kroger Chairman and CEO Rodney McMullen said in a statement Friday.
Shares of Kroger Co. fell slightly in morning trading, while shares of Albertsons Cos. increased by more than 2%.
https://finance.yahoo.com/news/kroger-albertsons-selling-more-400-140851461.html Kroger and Albertsons are selling more than 400 stores in a $1.9 billion deal to complete their merger