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Kroger Acquires Roundy’s Grocery & Pharmacy Stores

CINCINNATI and MILWAUKEE — The Kroger Co. is adding to its multifaceted retail stable. The company inked a definitive merger deal with Roundy's Inc. to acquire its 151 grocery stores and 101 pharmacies in the Midwest.

The locations operate under the Copps, Pick 'n Save, Metro Market and Mariano's retail banners in Wisconsin and Illinois. Roundy’s will continue to operate the stores as a subsidiary of Kroger and continue to be led by members of Roundy’s senior management team. There are no plans to close stores, and associates will have employment opportunities with both companies, according to a press release issued Wednesday.

"We are delighted to welcome Roundy's to the Kroger family," said Rodney McMullen, Kroger's chairman and CEO. "With a team of 22,000 talented associates, outstanding store locations and a shared commitment to putting customers first, we are excited about Roundy's future growth."

Kroger, one of the world's largest retailers, now serves customers at 2,623 supermarkets and multi-department stores in 34 states and the District of Columbia under two dozen local banner names including: Kroger, City Market, Dillons, Food 4 Less, Fred Meyer, Fry's, Harris Teeter, Jay C, King Soopers, QFC, Ralphs and Smith's. The company also operates 781 convenience stores, 327 fine jewelry stores, 1,350 supermarket fuel centers and 37 food processing plants in the United States. 

Once the Roundy’s merger is completed, the joint company will operate 2,774 supermarkets and employ more than 422,000 associates across 35 states and the District of Columbia. The transaction is expected to close by the end of 2015.

"Mergers for Kroger always involve both parties bringing something to the table," McMullen said. "We admire what Bob Mariano has done with the Mariano's banner in Chicago, where he has created an urban format that is resonating with customers and we expect to apply Roundy's experience to our stores in urban areas around the country."

Kroger will purchase all outstanding shares of Roundy's for $3.60 per share in cash, or $800 million. The merger agreement is subject to the satisfaction of customary closing conditions, including completion of the tender offer and regulatory approval.

Mariano, Roundy's president, CEO and chairman, added: "We are excited about becoming part of The Kroger Co. Kroger's scale, knowledge and experience allows us to accelerate the strategic initiatives we have invested in and makes us a more formidable competitor in the marketplace. This is a great win for our customers, communities, employees and our shareholders, and I personally look forward to continue to exceed customer and employee expectations."

Kroger's 781 convenience stores operate in 19 states under six banners: Kwik Shop, Loaf N' Jug, Quik Stop Markets, Tom Thumb Food Stores, Turkey Hill Minit Markets and Smith's Express. The stores offer a limited selection of Kroger private-label products, and some stores are served by Kroger distribution centers.

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