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Spartan Stores, Inc. said last week that it has completed the previously reported acquisition of 17 retail supermarkets and 15 pharmacies from VG's Food Center, Inc. and VG's Pharmacy, Inc., a privately held Fenton, Mich.-based retail grocery operator, as well as being Spartan's largest independent distribution customer.
The transaction is expected to boost annual retail segment sales by about $300 million, with annual consolidated sales growing by about $150 million, since VG's is an existing distribution customer. The acquisition is expected to be slightly dilutive to net earnings in the fiscal 2009 fourth quarter, but accretive during fiscal year 2010.
"This transaction provides us with the opportunity to sustain our long-term performance improvement record, capture additional operational synergies, and serve communities in key Michigan markets where we had no retail presence," said Spartan president and c.e.o. Dennis Eidson. "As we begin the integration process, we will bring our distinct and successful approach to marketing, merchandising, and category management to these markets, while preserving the long-standing and exceptional shopping experience that VG's has delivered to its customers for many years. Our sound balance sheet and financial position has allowed us to take advantage of prudent market share expansion opportunities during this challenging economic period and further solidify our position as a leading independent grocery retailer in Michigan."
Grand Rapids, Mich.-based Spartan Stores, Inc. is the nation's 10th-largest grocery distributor, with warehouse facilities in Grand Rapids and Plymouth, Mich. The company distributes over 40,000 private label and national brand products to about 350 independent grocery stores in Michigan, Indiana, and Ohio. Spartan also owns and operates 101 retail supermarkets in Michigan, among them Family Fare Supermarkets, Glen's Markets, D&W Fresh Markets, Felpausch Food Centers, and now VG's Food and Pharmacy.