Cincinnati-based The Kroger Co., the largest supermarket chain in the country, has completed its tender offer to purchase all the outstanding shares of Milwaukee-based grocery chain operator Roundy’s Inc. and expects to complete its $824 million acquisition later today.
Roundy’s has more than 22,000 employees and operates 151 stores and 101 pharmacies, which include the Pick ’n Save and Metro Market branded stores in Milwaukee, the Copps Food Center branded stores near Madison and in northern Wisconsin, and the Mariano’s branded stores in Chicago. It also has two major distribution centers, in Oconomowoc and Mazomanie.
Through the tender offer, Kroger purchased 33.1 million Roundy’s shares for $3.60 each in cash, which represented 67.1 percent of outstanding Roundy’s shares. The tender offer met the condition that the majority of outstanding shares be validly tendered. Kroger plans to complete its acquisition of the remaining shares not included in the tender offer today through a second-step merger.
The acquisition includes the $178 million stock purchase and also $646 million in existing Roundy’s debt.
Kroger has more than 422,000 employees and operates more than 2,774 supermarkets in 35 states and the District of Columbia under a variety of brand names, including: Kroger; City Market; Dillons; Food 4 Less; Fred Meyer; Fry’s; Harris Teeter; Jay C; King Scoopers; QFC; Ralphs and Smith’s. It also owns 786 convenience stores, 326 fine jewelry stores, 1,360 supermarket fuel centers and 37 food processing plants nationwide.
Later today, once the merger is complete, Roundy’s shares will end trading on the New York Stock Exchange.
“This merger blends Roundy’s complementary markets with Kroger’s strengths in scale and merchandising,” said Rodney McMullen, chairman and chief executive officer of Kroger. “Our future together is bright, and we look forward to learning from each other as partners. Most of all, we want to welcome each of Roundy’s more than 22,000 associates to the Kroger family of stores.”
Kroger also today announced Bob Mariano will continue to lead Roundy’s as president and CEO. He has been in the role since 2002.
“We look forward to bringing together the best of Roundy’s and Kroger for our customers and associates,” Mariano said. “Our merger with Kroger will help us continue to exceed our customers’ expectations.”
