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Will going bicoastal make Supervalu a stronger wholesaler?

Written by George Anderson

Photo: Supervalu

On Monday, Supervalu announced that it had reached a definitive agreement to acquire Unified Grocers in a deal valued at $375 million. The combination of the two companies will create a grocery wholesaling network with 24 distribution centers supplying over 3,000 stores across 46 states. The move will give Supervalu access to West Coast markets. Supervalu, which currently operates a single warehouse in Tacoma, WA, is headquartered in Eden Prairie, MN and primarily serves independents across the Midwest and East Coast. "Unified’s Members and customers operate some of the country’s most exciting and progressive Hispanic and multiple other ethnic formats, specialty, gourmet, natural/organic, price impact and traditional stores," said Mark Gross, president and chief executive officer of Supervalu, in a statement. "They complement our existing customer base and we look forward to facilitating collaboration and innovation across such an impressive collection of creative merchants.” Supervalu has focused on its grocery wholesale operations in recent years, going back to its sale of Albertsons and other chains in 2013. The company sold its Save-A-Lot hard discount grocery chain last year to the Canadian private equity firm, Onex. The deal enabled Supervalu to pay down debt and concentrate its attention on growing its wholesale business. Supervalu is the second largest wholesaler operating in the U.S., following C&S Wholesale Grocers. Mr. Gross, who joined Supervalu last year, came to the company with a reputation as a dealmaker after working in a number of financial and general management positions at C&S between 1997 and 2006. After leaving C&S, he founded Surry Investment Advisors to guide grocery clients on acquisitions and divestitures.

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