Table of Contents
CINCINNATI — The Kroger Co. and Albertsons Cos, today announced that they have entered a definitive agreement with C&S Wholesale Grocers LLC for the sale of 413 stores and other assets s in connection with the supermarket retailers’ proposed merger.
The agreement also calls for Keene, N.H.-based C&S Wholesale to acquire banners, distribution centers, offices and private label brands from Kroger and Albertsons.
Stores currently under banners to be retained by Kroger will be re-bannered into one of the retained Kroger or Albertsons Cos. banners, according to a press release announcing the agreement.
In the four states where C&S will have the license to the Albertsons banner, Kroger will re-banner the retained stores once the merger is completed. Kroger will maintain the Albertsons banner in the remaining states.
In addition, Kroger will divest the Debi Lilly Design, Primo Taglio, Open Nature, ReadyMeals and Waterfront Bistro private label brands.
“Following the announcement of our proposed merger with Albertsons Cos., we embarked on a robust and thoughtful process to identify a well-capitalized buyer who will operate as a fierce competitor and ensure divested stores and their associates will continue serving their communities in the ways they do today. C&S achieves all these objectives,” said Rodney McMullen, Kroger’s chairman and chief executive officer.
Kroger said the divestiture plan ensures no stores will close as a result of the merger and that all frontline associates will remain employed, all existing collective bargaining agreements will continue, and associates will continue to receive health care and pension benefits alongside bargained-for wages.
A pledge to support C&S competitiveness
Kroger said terms of the plan support C&S’s ability to operate divested stores effectively and efficiently by providing:
• Strong teams, with deep industry expertise and the ability to operate at scale, and to drive growth and operational advancements in the divested business;
• A cohesive set of stores in each geography supported by two regional headquarters as well as banners, and private label brands with strong consumer recognition that will provide C&S with an established base on which to grow its store network; and
• A robust operational infrastructure, including distribution centers and offices to support both the immediate and long-term success of the divested business.
“I have long respected C&S and its leadership team,” said Albertsons CEO Vivek Sankaran. “Most importantly, they have made a clear commitment to continuing to invest in and care for associates, including by honoring all collective bargaining agreements currently in place. I echo Rodney’s confidence in the bright future ahead for the associates joining the C&S team.”
A leader in wholesale grocery supply
Today’s announcement noted that C&S is an industry leader in wholesale grocery supply and supply chain solutions, with a track record as a successful grocery retailer. Founded in 1918 as a supplier to independent grocery stores, C&S supplies more than 7,500 independent supermarkets, retail chain stores and military bases.
C&S also operates Grand Union grocery stores and Piggly Wiggly franchise and corporate-owned stores in the Midwest and Carolinas.
Through its operations, C&S purchases more than 100,000 products, giving it the ability to provide customers with the best product selection and pricing available. In addition to its franchise and corporate owned supermarkets, C&S provides end-to-end wholesale, supply and marketing services to its retailer customers.
C&S also brings experience with the merger process, having been an FTC-approved divestiture buyer in prior grocery transactions, with experience transitioning union employees and their associated collective bargaining agreements. In anticipation of the agreement, C&S’s 1918 Winter Street Partners retail holding company has been established to ensure a seamless closing process.
The number of stores contained in the divestiture plan by geography is as follows:
• Washington: 104 Albertsons and Kroger stores.
• California: 66 Albertsons and Kroger stores.
• Colorado: 52 Albertsons stores.
• Oregon: 49 Albertsons and Kroger stores.
• Texas and Louisiana: 28 Albertsons stores.
• Arizona: 24 Albertsons stores.
• Nevada: 15 Albertsons stores.
• Illinois: 14 Kroger stores.
• Alaska: 14 Albertsons stores.
• Idaho: 13 Albertsons stores.
• New Mexico: 12 Albertsons stores.
• Montana, Utah and Wyoming: 12 Albertsons stores
• Washington, D.C., Maryland and Virginia: 10 Harris Teeter stores.
Kroger and Albertsons announced their intention to merge on October 14. At that time, executives with the companies said they expected the deal to close in early 2024 if it passed muster with antitrust regulators at the Federal Trade Commission and the Department of Justice, and survives any court challenges.
