...with brief, occasional, italicized and sometimes gratuitous commentary…
There were a couple of stories yesterday about which there are additional notes that should be made...
• Supervalu announced that it will acquire Unified Grocers for $375 million - $114 million in cash, and the assumption of $261 million in debt. But Reuters reported yesterday that under the terms of the deal, Supervalu would "receive a termination fee of $8 million plus reimbursement up to $1 million in costs, if deal is terminated by Unified Grocers." In other words, if the deal is vetoed by Unified's owner-members, they will have to write a check for up to $9 million.
In the event that federal regulators prevent the acquisition, Supervalu would have to pay a reverse termination fee of $9.5 million to Unified.
One source close to Unified told MNB that the potential of having to write a check in that amount almost certainly would influence how those owner-members cast their votes. Based on my conversations, there doesn't seem to be much chance that Unified will reject the offer, but that doesn't mean that there aren't a number of retailers concerned that their levels of service will decline once they are absorbed into what they feel is a highly centralized Supervalu machine.
And, as one person pointed out to me, at least part of the problem is the debt that Unified incurred during the Haggen debacle - and that Haggen has managed to claim yet another victim.
• The Charlotte Observer notes that as activist hedge fund Jana Partners takes a significant position in Whole Foods and pushes for organizational change, it has called for the election of new members of the board of directors. One of those suggestions - Thomas “Tad” Dickson, the former CEO of Harris Teeter, who led the company "from February 1997 until the Matthews-based grocery store chain was sold to Kroger in 2014. Dickson’s primary business now is private investing, Jana said in its filing."
• Bloomberg reports that before Jana Partners made its investment in Whole Foods, Amazon was seen as a possible bidder for Whole Foods, and "pondered a takeover of the organic-food chain last fall but didn’t pursue a deal, according to a person with knowledge of the situation.
"The e-commerce giant considered internally whether Whole Foods would help invigorate its nearly decade-long push into groceries, said the person, who asked not to be identified because the deliberations were private. The discussions never turned into a concrete plan, according to the person.
I find this one really hard to believe. I mean, I can imagine that the possibility might've come up at a meeting, or at a Seattle bar somewhere, but I cannot imagine it got very far. I just don't see how an Amazon acquisition of Whole Foods makes any sense at all.
There were a couple of stories yesterday about which there are additional notes that should be made...
• Supervalu announced that it will acquire Unified Grocers for $375 million - $114 million in cash, and the assumption of $261 million in debt. But Reuters reported yesterday that under the terms of the deal, Supervalu would "receive a termination fee of $8 million plus reimbursement up to $1 million in costs, if deal is terminated by Unified Grocers." In other words, if the deal is vetoed by Unified's owner-members, they will have to write a check for up to $9 million.
In the event that federal regulators prevent the acquisition, Supervalu would have to pay a reverse termination fee of $9.5 million to Unified.
One source close to Unified told MNB that the potential of having to write a check in that amount almost certainly would influence how those owner-members cast their votes. Based on my conversations, there doesn't seem to be much chance that Unified will reject the offer, but that doesn't mean that there aren't a number of retailers concerned that their levels of service will decline once they are absorbed into what they feel is a highly centralized Supervalu machine.
And, as one person pointed out to me, at least part of the problem is the debt that Unified incurred during the Haggen debacle - and that Haggen has managed to claim yet another victim.
• The Charlotte Observer notes that as activist hedge fund Jana Partners takes a significant position in Whole Foods and pushes for organizational change, it has called for the election of new members of the board of directors. One of those suggestions - Thomas “Tad” Dickson, the former CEO of Harris Teeter, who led the company "from February 1997 until the Matthews-based grocery store chain was sold to Kroger in 2014. Dickson’s primary business now is private investing, Jana said in its filing."
• Bloomberg reports that before Jana Partners made its investment in Whole Foods, Amazon was seen as a possible bidder for Whole Foods, and "pondered a takeover of the organic-food chain last fall but didn’t pursue a deal, according to a person with knowledge of the situation.
"The e-commerce giant considered internally whether Whole Foods would help invigorate its nearly decade-long push into groceries, said the person, who asked not to be identified because the deliberations were private. The discussions never turned into a concrete plan, according to the person.
I find this one really hard to believe. I mean, I can imagine that the possibility might've come up at a meeting, or at a Seattle bar somewhere, but I cannot imagine it got very far. I just don't see how an Amazon acquisition of Whole Foods makes any sense at all.
- KC's View:
