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Reuters reports that Spartan Stores will acquire Nash Finch Co. in a stock deal both companies valued at about $1.3 billion, that will "help expand Spartan's distribution presence beyond Michigan, Indiana and Ohio to 37 states and the District of Columbia. It also makes Spartan the largest food distributor to U.S. military commissaries and exchanges at home and abroad."

The announcement notes that "together, Spartan Stores and Nash Finch will have 22 distribution centers covering 37 states (and) 177 retail stores."

According to the Reuters story, "The offer of 1.2 Spartan shares for each Nash Finch share did not provide a premium to Nash Finch shareholders based on Friday closings, but has risen in value after Spartan shares rose on Monday. Spartan will also assume about $380 million in long-term Nash Finch debt. Nash Finch shareholders will end up owning 42.3 percent of the combined entity."

Spartan CEO Dennis Eidson will be president/CEO of the new company, while Nash Finch CEO Alec Covington will serve in an advisory role "to help ensure a smooth transition."

The official announcement maintains that "the combined company will have significant scale and geographic reach to provide value-added distribution services to a diversified customer base and drive new growth opportunities through increased customer penetration, new customer additions and expansion into new market segments. The combined company will also have a comprehensive portfolio of strong private brands including Spartan Stores' Spartan® brand and Nash Finch's Our Family® and Nash Brothers Trading Company® brands."
KC's View:
The new company, assuming the deal is approved by regulators, would seem to provide a lot of synergies and the potential to be more effective, not just more efficient, with the potential to grab a lot of market share in the wholesale business.

Experts in these matters seem to be feel that this is by no means the end of the mergers and acquisition activity in the retail/wholesale segments. I have no reason to disagree with that ... the question seems to be when, not whether, the next deal will take place.