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Aldi To Buy 400 Winn-Dixie And Harvey’s Grocery Stores In The Southern U.S.

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Aldi To Buy 400 Winn-Dixie And Harvey's Grocery Stores In The Southern U.S.

(CTN News) – In an announcement on Wednesday, discount supermarket Aldi announced that it plans to acquire 400 Winn-Dixie and Harvey’s supermarkets in the southern United States.

Aldi has proposed to merge with Southeastern Grocers Inc., the parent company of Winn-Dixie and Harvey’s, a grocery chain based in Jacksonville, Florida, in a deal that would see Aldi acquire all outstanding shares of Southeastern Grocers. It is expected that the deal will close in the first half of 2024 if it is approved by regulators.

There have been no financial details released about the deal. Neither Southeastern Grocers nor Aldi are public companies, but they are private companies. It is based in Germany and has its U.S. headquarters in Batavia, Illinois, a suburb of Chicago.

Aldi’s long-term growth strategy in the U.S. is supported by this deal, and by the end of this year it expects to reach 2,400 stores in the country.

It is primarily acquiring Winn-Dixie supermarkets and Harveys supermarkets in Alabama, Florida, Georgia, Louisiana and Mississippi, but it is also acquiring other supermarkets.

With features such as limited selection and self-bagging, Aldi will convert some locations to its own brand. In addition, some Winn-Dixie and Harvey’s stores will be operated by the company.

Neil Saunders, an analyst with GlobalData Retail, said Aldi usually opens its own stores. Aldi could be experimenting with more traditional supermarkets that don’t follow its low-cost model, he said. In addition, Aldi’s deep pockets and efficient supply chain will make Southeastern’s stores more competitive.

As grocery stores consolidate, Walmart is attracting customers away from them. Walmart controlled 25 percent of U.S. grocery sales for the year ending June 30, according to Numerator.

Approximately 2% of shares were held by Aldi, while less than 1% by Southeastern Grocers. Since 2021, Aldi’s share had grown 0.2%, while Southeastern Grocers’ share had declined 0.2%.

Earlier this year, Kroger and Albertsons announced plans to merge in a $20 billion deal. That plan is being reviewed by regulators now; if approved, it will close early next year. The two companies control roughly 18% of the U.S. grocery market, according to Numerator.

However, not everyone supports consolidation. According to the union representing Kroger and Albertsons-owned Safeway, the companies weren’t transparent about the merger’s impact on jobs. The union voted to oppose the merger in May.

It was also reported that the secretaries of state of seven states with nearly 5,000 Kroger and Albertsons stores, including Colorado, Arizona, Minnesota, and Maine, opposed the merger to the Federal Trade Commission on Wednesday, saying it would limit consumer choice and prevent stores from holding down prices against competition.

Additionally, Southeastern Grocers will sell its 28 Fresco y Mas locations to Fresco Retail Group, an investment company.

SEE ALSO:

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