Supervalu To Acquire Unified Grocers In $375 Mln Deal

(RTTNews) - Supervalu Inc. (SVU) said that it agreed to acquire Unified Grocers Inc in a transaction valued at approximately $375 million, comprised of approximately $114 million in cash for 100 percent of the outstanding stock of Unified Grocers plus the assumption and pay-off of Unified Grocers' net debt at closing (approximately $261 million as of April 1, 2017).

The transaction,which was unanimously approved by each company's board of directors, is currently expected to close in mid-to-late summer 2017, subject to approval by Unified's shareholders and other customary closing conditions. Following completion of the merger, Unified Grocers will be a wholly-owned subsidiary of Supervalu.

Supervalu expects that by the end of the third year of operations after the completion of the transaction, the combined business will achieve a run rate of at least $60 million in cost synergies.

Supervalu expects to incur transition and integration costs of up to $60 million within the first two years following the completion of the transaction. The transaction is expected to be accretive to earnings per share, excluding the transition and integration costs as well as potential purchase accounting adjustments, in the first full fiscal year following closing which begins on February 25, 2018.