Big V Goes to Wakefern
The U.S. Bankruptcy Court for the District of Delaware has approved the sale of nearly all the assets of Big V Supermarkets to Wakefern. Judge Raymond T. Lyons ruling will allow Wakefern’s Shoprite Supermarkets to operate 27 Big V stores in New York and New Jersey. The transition is expected to be completed by mid-July according to the Times Herald-Record of Middletown, N.Y.
This deal was critical for Wakefern. Big V represents roughly 13 percent of the co-op’s sales volume.
The deal was also costly for Wakefern. The co-op initially offered $150 million for Big V, but was forced to increase its offer to $185 million to fend off a bid by Ahold’s Stop & Shop division.
Moderator Comment: Did Wakefern need to make the Big
V deal or would passing on it have been an “intelligent loss of business?”
According to the Times Herald-Record, one of Big
V’s lawyers had this to say to the Wakefern people attending the hearing, “Congratulations,
you’ve got 27 more headaches now.”
Speculation is that Stop & Shop got involved simply to
drive up the price for Wakefern. After the Pathmark deal fell through, many
believed there was little likelihood that the court would have approved a Stop
& Shop takeover of Big V. We may never know for sure. We do know that Wakefern
paid $35 million more than it wanted, however. [George
Anderson – Moderator]