Last week the Cincinnati Business Courier reported that an analyst report out of Europe speculated that Kroger was pursuing a merger with Ahold Delhaize (Giant, Food Lion, Stop & Shop, Peapod, among others). On Wednesday of last week, Supermarket News reported that it was not able to verify the substance of the claim.
Analysts have talked about such a merger before, suggesting that the two powerful food retailers could gain additional scale and more effectively fight competitors like Walmart, Aldi and Amazon-Whole Foods. A merger would also provide Kroger with access to Peapod and its e-commerce platform.
As reported in Supermarket News, Ahold and Kroger have similar operating strategies in the U.S., both have invested in lower prices and have developed distinct private brands. Although the two companies compete in the Southeast, Ahold's Northeast store base would compliment Kroger's existing footprint.
Showing posts with label Cincinnati Business Courier. Show all posts
Showing posts with label Cincinnati Business Courier. Show all posts
Monday, October 9, 2017
Thursday, September 1, 2016
Kroger may look to buy part of Rite Aid portfolio
The Cincinnati Business Courier reported on Monday that Kroger could be a prime bidder for some Rite Aid or Walgreens drug stores that will need to be sold when the two companies complete their merger later this year. Kroger was rumored to be interested in purchasing Rite Aid before the chain reached a deal with Walgreens.
Industry experts say that about 500 of Rite Aid's 4,600 stores will need to be sold.
Kroger, the nation's largest operator of traditional supermarkets, is also the nation's fifth largest pharmacy operator with 2,200 in-store locations. Leon Loewenstine, an investment strategist with RiverPoint Capital Management, believes such a deal would only make sense if Kroger planned to keep running any acquired drug stores, where they could keep using the chain's customer loyalty cards. Loewenstine compared the idea to Kroger's launch of stand-alone gas stations, which supplement their gas stations at Kroger supermarket locations.
"It would be a new venture, a new avenue of growth for the company," said Loewenstine. "They could compete with Walgreens and CVS. If anybody can do it, it would be Kroger."
Industry experts say that about 500 of Rite Aid's 4,600 stores will need to be sold.
Kroger, the nation's largest operator of traditional supermarkets, is also the nation's fifth largest pharmacy operator with 2,200 in-store locations. Leon Loewenstine, an investment strategist with RiverPoint Capital Management, believes such a deal would only make sense if Kroger planned to keep running any acquired drug stores, where they could keep using the chain's customer loyalty cards. Loewenstine compared the idea to Kroger's launch of stand-alone gas stations, which supplement their gas stations at Kroger supermarket locations.
"It would be a new venture, a new avenue of growth for the company," said Loewenstine. "They could compete with Walgreens and CVS. If anybody can do it, it would be Kroger."
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