Kroger to buy Harris Teeter for about $2.44B
CINCINNATI (AP) — Kroger, the country’s largest traditional supermarket operator, said Tuesday that it has agreed to buy Harris Teeter Supermarkets Inc. for about $2.44 billion in cash.
The deal expands Cincinnati-based Kroger’s store base in the southeastern and mid-Atlantic markets and increases the number of states it operates in by three to 34.
Under the terms of the agreement, Kroger will pay $49.38 for each of the fellow supermarket chain’s shares. The price represents a 2 percent increase over the company’s Monday closing stock price.
“This is a financially and strategically compelling transaction and a unique opportunity for our shareholders and associates,” Kroger Chairman and CEO David Dillon said in a statement.
The deal has been approved by both companies’ boards. Harris Teeter announced in February that it was exploring strategic alternatives, including a possible sale.
Harris Teeter operates 212 stores in eight southeastern and mid-Atlantic states and Washington DC, along with a pair of distribution centers and a dairy facility in North Carolina. Its fiscal 2012 revenue totaled about $4.5 billion.
In comparison, Kroger operates 2,419 stores in 31 states. In addition to its flagship brand of supermarkets, it also owns Ralphs, Fry’s and Food 4 Less.
After the deal closes, Harris Teeter will become a Kroger subsidiary and will continue to be led by members of its current senior management.