Raley’s Completes Acquisition of Bashas and Forms New Company

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UPDATE: December 16, 2021: Raley’s said on Wednesday it completed the acquisition of Arizona-based Bashas earlier this week, closing the deal it announced in October. To manage the combined companies, the grocer has created a new entity called The Raley’s Companies which will oversee the operational divisions of Raley’s and Bashas.

Keith Knopf heads The Raley’s Companies as President and CEO while Edward “Trey” Basha is President of Bashas. Raley’s operating division will appoint a chairman next month, according to a press release on Wednesday.

As part of the announcement, Raley’s said it will grant all eligible retail and distribution employees in its divisions a pay raise in early 2022.

Dive brief:

  • Raley’s has signed a definitive agreement to acquire the Bashas family of stores, according to a press release on Friday. Financial terms of the deal were not disclosed.
  • Bashas will continue to operate its existing banners under the Raley’s business and will retain its corporate headquarters, more than 100 stores and a distribution center in Arizona. The companies expect the deal to close by the end of this year.
  • The companies combined under Raley’s will operate more than 200 stores in northern California, Arizona, New Mexico and parts of Nevada.

Dive overview:

By acquiring Bashas, ​​Raley’s nearly doubles its store footprint and takes control of one of Arizona’s leading grocers as it seeks greater economies of scale.

Friday’s announcement indicated that Raley’s would not close any Bashas stores and that employees would retain their current roles, compensation and benefits. He also noted that Raley’s would not make any changes to the management of local stores, but did not present plans for the chain’s management roles – leaving the door open for the California grocer to make adjustments to the chain. Mountain peak.

In a video presentation released to Bashas workers on Friday, Edward “Trey” Basha, President and CEO of Bashas, ​​as well as Keith Knopf, President and CEO of Raley’s Holding Company, shared the news of the ‘acquisition and assured them that local operations would remain unchanged.

“At Raley’s, we will have a partner who will ensure that we continue to deliver exceptional experiences to customers and members at a time when regional grocery competition has never been so fierce – while staying true to the values ​​that have shaped our history over the past 90 years, ”Basha said in the announcement.

Knopf, meanwhile, noted in a statement that “robust digital capabilities and combined purchasing power” will benefit buyers of both companies.

Small regional grocery chains find it difficult to compete with the scale advantages that large chains enjoy in terms of price, digital services and other areas. But the injection of liquidity provided by the pandemic offers an opportunity for regional retailers to acquire other operators. In February, Tops Markets and Price Chopper / Market 32 ​​agreed to merge and create a combined chain operating nearly 300 stores in six northeastern states.

In recent years, Raley’s has worked to differentiate its stores with a greater emphasis on health, specialty products and in-store experiences. In Arizona, Bashas competes with Kroger’s-owned Fry’s, as well as burgeoning specialty chain Sprouts Farmers Markets, as well as discount retailers Aldi and Walmart.

Basha ‘ operates more than 100 stores, including the Food City banners, AJ Fine Foods and Eddie’s Country Store, as well as the Basha ‘ Having dinner supermarket serving Native American communities. Raley’s operates 124 stores, primarily in Northern California, through four different banners: Raley’s, Nob Hill Foods, Bel Air and Raley’s A MARKET.

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