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What Should Kroger Do With Giant Eagle After its Purchase Is Completed?

Written by Nicholas Morine

Today's big news in the grocery space: Kroger has announced the purchase of Pittsburgh-based grocery chain Giant Eagle in a deal valued at $1.65 billion -- $1.25 billion in cash consideration and the remainder in the taking of outstanding liabilities.

The leaders of both grocers took the opportunity to offer remarks over the deal in a press release.

"Giant Eagle is a well-run, high-quality regional grocer with a strong reputation for fresh products, pharmacy, private label and customer loyalty. We evaluated the opportunity carefully, and the strategic fit is clear," said Kroger CEO Greg Foran.

"Giant Eagle expands our reach into attractive adjacent markets, allowing us to do what we do best: Run outstanding stores, deliver fresh foods and convenient meal solutions at affordable prices, and take care of our customers and associates every single day," he added.

"Today's announcement marks an exciting next chapter for our Team Members, customers, vendors and community partners. Together with Kroger, we will be well-positioned to advance our strategy and deliver better quality and service, better everyday value, and a better shopping experience for our customers, while providing greater growth opportunities for our dedicated Team Members," said Giant Eagle CEO Bill Artman.

Kroger Doesn't Appear To Want To Change Much for Giant Eagle -- At Least in the Near Term

Kroger indicated that Giant Eagle's existing network of stores, private label branding, pharmacy, and loyalty program were standout items considered valuable as part of the purchase. In commentary between Artman and KDKA Radio, the Giant Eagle CEO delivered further details over the acquisition -- including that Giant Eagle would be holding on to its name "and it’s commitment to serving its customers as it always has – with the same familiar supermarkets and pharmacies, high-quality products and services, and dedicated Team Members," suggesting that Kroger was intending to leave things as-is (at least for the time being).

Other details confirmed by way of that radio interview:

  • Giant Eagle's HQ would be staying in Cranberry Township, and the existing leadership structure of the grocer would remain in place.
  • Giant Eagle's existing framework would be called upon to continue operating its grocery stores, pharmacy businesses, and Market District brands. In addition, Giant Eagle would essentially be a division of Kroger -- "similar to how the Cincinatti-based grocery operates its other divisions," per Audacy's Andrew Limberg.
  • The myPerks loyalty program will also be retained, coinciding with the thrust of the press release, but Kroger will be "exploring additional opportunities to expand its reach."

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