Kroger Co. said Wednesday it has completed its acquisition of Harris Teeter Supermarkets for about $2.5 billion.
The company also said that Thomas W. Dickson, chairman and CEO of Harris Teeter, has retired, and that John Woodlief, EVP and CFO of Harris Teeter would leave the company. Woodlief previously had been a managing partner at Pricewaterhouse Coopers, and is prohibited from working in a financial position at Kroger because PwC is Kroger’s independent accountant. He will remain available as a consultant, Kroger said, and will pursue other interests.
Under the terms of the merger agreement, Harris Teeter shareholders will receive $49.38 per share of Harris Teeter common stock.
The purchase gives Cincinnati-based Kroger 227 stores in the Southeast and Mid-Atlantic. Harris Teeter also operates distribution centers for grocery, frozen and perishable foods in Greensboro, N.C., and Indian Trail, N.C., and a dairy facility in High Point, N.C. Harris Teeter will maintain its headquarters in Matthews, N.C., and will continue to operate its stores under the Harris Teeter brand name as a subsidiary of The Kroger Co.
Harris Teeter will continue to be led by Harris Teeter’s current president, Fred Morganthall. There are no plans to close stores, Kroger said.
Together, the company will operate 2,641 supermarkets and employ more than 368,000 workers is 34 states and the District of Columbia. Harris Teeter had revenues of $4.7 billion for fiscal year 2013. The acquistion will push Kroger's annual volume over $100 billion.
“We are pleased that our merger is complete and look forward to bringing together the best of Kroger and Harris Teeter to benefit our customers, associates and shareholders,” said W. Rodney McMullen, CEO of Kroger, in a statement. “This merger brings the exceptional Harris Teeter brand and a complementary base of stores in attractive markets to the Kroger family. We have long respected Harris Teeter’s customer orientation, friendly and professional associates, strong management team, and company values – which are consistent with ours. Together, through our customer 1st strategy, we are going to be an outstanding combination.”
Kroger financed the transaction through a combination of debt issued in December 2013 and commercial paper.
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