FILE – Kroger logo is seen at one of their stores.
The Kroger Co. announced Wednesday it has entered a definitive agreement to acquire Giant Eagle, a move that will expand the retail giant’s footprint across five states in the Midwest and Mid-Atlantic regions.
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Kroger to buy Giant Eagle
What we know:
The transaction is valued at $1.65 billion, comprised of $1.25 billion in cash and the assumption of approximately $400 million in outstanding liabilities. The deal has been unanimously approved by Kroger’s board of directors.
Giant Eagle, a family-owned retailer based in Pittsburgh, currently generates approximately $9 billion in annual sales. Its footprint includes 197 supermarkets and 11 standalone pharmacies across Ohio, Pennsylvania, West Virginia, Maryland and Indiana.
What they’re saying:
“Giant Eagle is a well-run, high-quality regional grocer with a strong reputation for fresh products, pharmacy, private label and customer loyalty,” Kroger CEO Greg Foran said in a statement. Foran noted that the deal allows the company to enter “attractive adjacent markets” while utilizing Kroger’s data, e-commerce solutions and operating capabilities to drive future growth.
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Giant Eagle CEO Bill Artman said the acquisition represents the “next chapter” for the company. “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,” Artman said.
What’s next:
The transaction is expected to close in 2027, pending regulatory clearance and other customary closing conditions. Both companies anticipate that the regulatory process will require “limited” store divestitures.
From a financial perspective, Kroger stated that it expects the acquisition to be accretive to adjusted earnings per share in the second full year following the closing of the deal. Kroger also committed to maintaining its net total debt to adjusted EBITDA ratio target of 2.3 to 2.5 times and plans to continue its current dividend and $2 billion share repurchase program.
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