Certified Grocers Midwest Buying Fresh Brands
By George Anderson
The grocery wholesaler and operator of Piggly Wiggly and Dick’s Supermarkets, Fresh Brands, announced yesterday it has agreed to be sold to Certified Grocers Midwest in a deal valued at $100 million. The deal is expected to close in the first quarter of 2006.
Ken Koester, president and chief executive officer of Certified Grocers Midwest, said in a released statement, “The acquisition of Fresh Brands provides many opportunities to strengthen both organizations. Certified is looking forward to working with the associates of Fresh Brands because both organizations are dedicated to providing independent supermarket operators with excellent service at a low cost. We are owned by successful independent supermarket operators and believe that the enhanced buying power and other benefits of the merger will provide great value and opportunities to the Fresh Brands franchisees as well as the independent supermarket operators that we serve.”
Certified Grocers Midwest, a 200 member cooperative with headquarters in Hodgkins, Ill., has not said whether it will continue to run the 20 stores that are corporately-owned by Fresh Brands.
Supermarket industry consultant and RetailWire BrainTrust member David Livingston told the Milwaukee Journal Sentinel, “I think they’ll try to spin them off. I think what they want to do is consolidate the wholesale business with theirs.”
Tom Harenburg, president of the brokerage firm Carl M. Hennig Inc., said that, even with this deal, the stores supplied by Fresh Brands face a tough road ahead with Wal-Mart serving as the biggest obstacle.
Moderator’s Comment: What is your reaction to Certified Grocers deal to buy Fresh Brands? Do you expect to see consolidation
activity pick up in the grocery business in 2006? –
George Anderson – Moderator
- Certified Grocers to buy Fresh Brands – Milwaukee Journal Sentinel
- Fresh Brands, Inc. Announces Agreement to Be Acquired by an Affiliate of Certified Grocers
Midwest, Inc. for $7.05 Per Share – Fresh Brands, Inc./Business Wire