SpartanNash owns a number of retail fascias, including Family Fare.
Byron Center, Michigan-based SpartanNash Co. plans to sell its business to a privately-held wholesale grocery distributor, and the parent company of Piggly Wiggly Supermarkets, in a $1.77 billion deal, the companies announced this morning.
Keene, New Hampshire-based C&S Wholesale Grocers has agreed to acquire SpartanNash for $26.90 per share, representing a total consideration of $1.77 billion, including debt, as the companies seek to compete better against larger global grocers in the U.S. supermarket sector.
The offer represents a 52.5% premium over SpartanNash’s closing price on 20 June and the company’s stock has soared since the announcement, reaching around $26.50.
Together, the combined company will operate almost 60 distribution centers covering the U.S. and will serve close to 10,000 independent retail locations, with more than 200 corporate-run grocery stores also under their umbrella.
In a joint media release, the companies said that the deal has been designed to provide a more efficient supply chain as well as an ability to secure the “best possible” delivered cost of goods and promotional discounts, which are expected to translate into lower prices for grocery shoppers.
C&S And SpartanNash Merger
Founded in 1918, C&S Wholesale Grocers supplies more than 7,500 independent supermarkets, chain stores, military bases and institutions with over 100,000 different products. It also operates and supports corporate grocery stores and services independent franchisees under a chain-style model throughout the U.S. Midwest, South and Northeast.
SpartanNash operates two complementary business segments – food wholesale and grocery retail. In terms of retail operations, the company operates nearly 200 brick-and-mortar grocery stores, primarily under the banners of Family Fare, Martin’s Super Markets and D&W Fresh Market, in addition to dozens of pharmacies and fuel centers with associated convenience stores.
On the wholesale side, SpartanNash serves customers that include independent and chain grocers, national retail brands, e-commerce platforms, and U.S. military commissaries and exchanges.
SpartanNash Q1 Results
SpartanNash posted Q1 adjusted earnings per share of $0.35 in the 16 weeks to April 19, missing the analyst consensus of $0.45. However, revenue for the quarter came in at $2.91 billion, surpassing estimates of $2.87 billion and representing a 3.7% increase year-on-year.
The company’s retail segment saw a 19.6% jump in net sales to $947.2 million, driven by incremental sales from acquired stores and a 1.6% rise in comparable store sales. However, the wholesale segment experienced a 2.6% decline in net sales to $1.96 billion.
The merged businesses will have around 60 distribution centers combined.
“The combination of our two companies’ capabilities puts our collective customers’ stores and our own retail stores at the center of the plate, supporting their ability to thrive in a highly dynamic and competitive environment. Our customers need us more than ever, and we are building a sustainable platform for our team members to be able to support them long into the future,” C&S CEO Eric Winn said of the deal.
The proposed merger, which has been unanimously approved by the boards of both companies, is expected to close in late 2025.
“For our customers, this transaction creates the necessary scale, efficiency and purchasing power needed to enable independent retailers to compete more effectively with larger big box chains,” SpartanNash President and CEO Tony Sarsam said.
“Neighborhood grocers are essential pillars of our communities that we want to preserve and strengthen. A thriving hometown grocery store supports local farmers, bolsters the local economy, and enhances the overall health and well-being of the community,” the SpartanNash boss added.
