United Natural Foods will acquire Supervalu for $32.50 per share in cash, or about $2.9 billion, including the assumption of outstanding debt and liabilities.
Over time, United, also known as UNFI, plans a divestment of Supervalu retail supermarket assets.
Benefits cited in merging the wholesale operations include expansion of the UNFI customer base and product assortment, increased scale and synergies of operations and technology, and exposure across channels, particularly where demand for wellness-oriented products is increasing and UNFI is under-represented.
Steven Spinner, UNFI chairman and CEO, will lead the combined entity while Sean Griffin, UNFI COO, will lead Supervalu integration efforts, post close, and head up an integration committee comprised of executives from both companies assembled to drive the implementation of best practices, the delivery of important synergies and a rapid and smooth integration.
“This transaction accelerates UNFI’s Build out the Store growth strategy by immediately enhancing our product range, equipping us to bring an attractive, comprehensive product portfolio to an expanded universe of customers,” said Spinner. “Combining our leading position in natural and organic foods with Supervalu’s presence in fast-turning products makes us the partner of choice for a broader range of customers. Together, we can provide our ‘better-for-you’ products as well as other high-growth segments, improving customers’ competitive advantages in a dynamic marketplace.”
Mark Gross, Supervalu CEO, said, “The combination of UNFI and Supervalu provides a substantial premium and delivers certainty of value to our stockholders, meaningful benefits to our customers, expanded opportunities for our employees and the ability for us and our vendors to efficiently serve a varied customer base. We have been executing an ambitious strategic transformation for over two years. We believe that this transaction is the best and natural next step for our stockholders, customers and employees.”
The transaction has been approved by the boards of directors of both companies and is subject to antitrust approvals, Supervalu shareholder approval and other customary closing conditions, and is expected to close in the fourth quarter of calendar year 2018.