With the regulatory review process complete and approval from the Federal Trade Commission (FTC) received, Price Chopper/Market 32 and Tops Markets on Monday announced the closure of their merger announced earlier this year.
Under the terms of the agreement, the two companies will be managed locally by their respective leaders and continue to be referred to by their established brand identities, but will be owned and overseen by a new parent company, Northeast Grocery Inc. Scott Grimmett, current president and CEO of Price Chopper/Market 32, will lead the new parent company. He will also serve on its board of directors as will Frank Curci, former Tops Markets chairman and CEO.
The agreement virtually doubles the two independent chains’ collective footprint in the Northeast, with a total of nearly 300 stores. Financial terms of the deal were not disclosed.
“We’re appreciative of the FTC’s diligence in reviewing this merger and grateful to have received all of the necessary approvals,” said Grimmett. “Now, we can dedicate ourselves to bringing these two storied grocery chains together, leveraging best practices, developing new opportunities and finding efficiencies that will help us continue to deliver distinctive shopping experiences,”
The regulatory review process by the FTC mandates the divestiture of 12 of the combined companies’ stores, all Tops locations. Food distributor C&S Wholesale Grocers has been approved to purchase all 12 stores, which will be operated by GU Markets LLC, an affiliate of C&S Wholesale Grocers. C&S will continue to recognize the union workforce at these locations.
“We believe that this merger will be a positive for our membership, preserving union jobs and strengthening the company’s prospects into the foreseeable future,” said Frank DeRiso, president of the UFCW Local One. “We are pleased that we have an agreement with the new owner and they are committed to retaining all of the existing union jobs and contracts. This merger will benefit both consumers and union members.”
Blaine Bringhurst will serve as president of the Price Chopper/Market 32 business and John Persons as the president of the Tops Markets business. Dave Langless, the chief financial officer of Tops, will serve as the parent company’s CFO.
Northeast Grocery Inc. will be headquartered in Schenectady, N.Y., as will Price Chopper/Market 32. Tops Markets will retain its headquarters in Williamsville, N.Y.
"Completing the details of this merger marks a major milestone for the management teams of both Price Chopper/Market 32 and Tops,” said Grimmett. “And I’m confident that our teammates and associates are excited about it and will continue to deliver excellence.”
Speaking to Supermarket News earlier this year, Grimmett talked about the benefits of scale for the two merged chains. “The scale will have impact in many ways, but it's in two big buckets. One, certainly it’s going to provide us the opportunity to have a stronger voice when it comes to our vendor relations and negotiating contracts and such — much like some of the other bigger players. And it's going to put us in a position to help us better compete with the changing marketplace.
“But also, best practices. We have two very solid upstate New York grocery chains. They've been serving their customer base for years and years and years and have some very, very bright minds that are operating those two businesses. And tapping all those bright people and coming together with the best of the best, the best ideas and sharing those, certainly is what we hope to capture putting these two organizations together.”