Friday, July 12, 2013

Kroger to purchase Harris Teeter supermarkets

Cincinnati-based Kroger has agreed to purchase North Carolina-based Harris Teeter for $2.5 billion, or $49.38 per share plus the assumption of $100 million in debt. Kroger is the largest traditional grocery chain in the U.S. with approximately 2,500 supermarkets in 31 states.

According to reports, Kroger likes Harris Teeter's strong position in growing markets, like the Mid-Atlantic and Southeast. Acquiring the company allows Kroger to enter certain markets - like Washington D.C. and Charlotte, NC - less expensively than through new store development.

Kroger is expected to retain the Harris Teeter name, and although Kroger mostly operates unionized stores and Harris Teeter does not, analysts don't believe the Harris Teeter stores would become unionized.

Harris Teeter currently operates over 200 stores in eight states and the District of Columbia.

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