Unified Grocers

Supervalu To Acquire Unified Grocers To Create One Of The Nation’s Leading Grocery Wholesale Companies

(MINNEAPOLIS, MN and COMMERCE, CA)

    • Adds leading West Coast focused wholesale grocery and specialty distributor to SUPERVALU’s existing distribution network, bringing together two highly complementary organizations with combined 2016 sales of approximately $16 billion
  • Combined business designed to deliver value to SUPERVALU stockholders with at least $60 million in run rate cost synergies expected to be realized by the end of the third year of operations
  • Creates opportunity to leverage Unified’s comprehensive specialty and ethnic offerings across SUPERVALU’s existing customer network while providing Unified’s retail base the ability to benefit from SUPERVALU’s extensive professional services portfolio
  • SUPERVALU to use cash on hand and borrowings under its credit facilities to purchase Unified’s equity and repay Unified’s outstanding net debt, giving SUPERVALU the flexibility to further focus on growing its customer base while efficiently delivering best in class wholesale services aimed at enhancing customers’ competitiveness

SUPERVALU INC. (NYSE: SVU) and Unified Grocers, Inc. today announced that they have entered into a definitive merger agreement for SUPERVALU to acquire Unified Grocers in a transaction valued at approximately $375 million, comprised of approximately $114 million in cash for 100 percent of the outstanding stock of Unified Grocers plus the assumption and pay-off of Unified Grocers’ net debt at closing (approximately $261 million as of April 1, 2017).

This transaction will bring together two 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. The combined company will be uniquely positioned to efficiently serve a broad range of independent customers and offer a diverse array of value added services, helping customers compete in an increasingly demanding grocery environment. The acquisition also provides new growth opportunities across multiple geographies, including the expansion of Unified’s Market Centre division, a growing business providing specialty and ethnic products to independent customers.

“We’re thrilled at the opportunity to bring together these two great organizations,” said Mark Gross, SUPERVALU’s President and Chief Executive Officer. “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. We’re also excited to serve Unified’s dynamic retailer base. 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.”
Gross continued, “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. We will make a great team together.”
“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.”

 

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