After decades serving the supermarket industry primarily in a supporting role, C&S Wholesale Grocers is getting ready to take center stage.

If approved by regulators, the nearly $2 billion deal C&S announced Friday to buy more than 400 grocery stores from Kroger and Albertsons would catapult the privately held company — known mainly as a grocery distributor —  into a high-profile role as steward of some of the best-known supermarket banners in the U.S., including QFC, Carrs and Mariano’s.

C&S has yet to say whether it intends to continue operating the QFC, Carrs and Mariano’s stores it is set to acquire under those names, but it will have the right to do so, Kroger CFO Gary Millerchip said Friday during an earnings call.

However it decides to proceed, C&S would have a major presence in some of the nation’s top grocery markets if its planned transaction with Kroger and Albertsons goes through. In addition, the plan — designed to assuage antitrust concerns related to plans by Kroger and Albertsons to merge — would give C&S a license to use the Albertsons name in four states.

The proposed grocery store realignment adds up to an enormous upgrade in C&S’ position in the nation’s grocery industry. The New Hampshire-based company currently runs about 160 grocery stores, including franchise and corporate-owned Piggly Wiggly stores in the Midwest and Carolinas, plus nearly a dozen Grand Union stores in New York and Vermont that it acquired in 2011 in connection with the Tops-Price Chopper merger.

Founded more than a century ago as a supplier to independent grocers, C&S has long focused on its wholesale business. Despite setbacks in recent years, such as the loss of key customer Ahold Delhaize in 2019, C&S remains a force in the grocery distribution business, serving more than 7,500 independent supermarkets and other food retailers.

Millerchip indicated during the conference call that Kroger believes C&S is well-positioned to build its competitive position as a grocery retailer. “From our perspective, we got very comfortable with their financing strategy and feel they both have the financial strength to be able to complete the transaction, but also the financial strength to be able to keep investing in the business going forward as well,” said Millerchip.

Kroger and Albertsons have a distinct interest in ensuring that their store divestiture plan spawns a strong retail competitor with the muscle to keep operating over the long haul. Executives certainly recall Albertsons’ ill-fated sale of 160 stores back in 2015 to Haggen, a much smaller retailer, in connection with Albertsons’ merger with Safeway. Despite Haggen’s best intentions, the company was unable to handle the challenge of managing those stores, driving it to declare bankruptcy and sell the stores back to Albertsons.

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Fareway opens eighth Meat Market

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Number of the week: 400

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What’s ahead

Inflation figures due

The U.S. Bureau of Labor Statistics’ latest Consumer Price Index data is set to be announced Wednesday. The figures will provide insight into whether the slowdown of inflation that started last fall continued into August. 

Retail sales data released

Retail sales data for last month are scheduled to be released by the U.S. Census Bureau on Thursday, offering a look at how factors like inflation impacted sales for the grocery industry during August.