Citing a desire for greater scale in their combined markets, supermarket chains Winn-Dixie and Bi-Lo are merging.
Bi-Lo agreed today to purchase Winn-Dixie for $9.50 a share- about 75% higher than the stock’s closing price Friday- in a $560 million buyout. Currently, the chains do not overlap in market geographically- Winn-Dixie owns 480 locations in Florida, Georgia, Alabama, Mississippi and Louisiana; while Bi-Lo has 207 locations in South Carolina, North Carolina, Tennessee and Georgia.
No stores for either brand are expected to close due to the merger, and both brands are expected to remain intact as the companies move forward. In the past decade, both Bi-Lo and Winn-Dixie have filed for forms of bankruptcy protection, the former in 2009 and the latter in 2005. Winn-Dixie “closed hundreds of locations” after its mid-00s financial struggles.
The companies released a joint statement this morning about the merger, and R. Randall Onstead Jr., Bi-Lo’s chairman, commented:
“With no overlap in our markets, the combined company will have a perfect geographic fit that will create a stronger platform from which to provide our customers great products at a great value, while continuing to offer exceptional service. BI-LO and Winn-Dixie are both strong regional brands with similar heritages, compelling customer connections, and outstanding employees. Both have been an important part of the communities and families they serve, and we look forward to building upon these two iconic brands and serving loyal customers for years to come.”
Winn-Dixie CEO Peter Lynch said:
“This transaction with BI-LO provides Winn-Dixie shareholders with a significant cash premium for their shares. We believe this transaction is in the best interests of our shareholders. By combining BI-LO and Winn-Dixie, we anticipate building a company that is stronger than our individual businesses and creating opportunities for continued advancement through the cross-pollination of our people and the sharing of ideas across our organizations, all to the benefit of our guests, suppliers, team members and the neighborhoods that Winn-Dixie serves.”
Until the transaction is complete, both entities will operate separately.