Dive Brief:
- SpartanNash announced Monday that it has agreed to acquire regional grocer Fresh Encounter Inc. Terms of the deal were not disclosed.
- Fresh Encounter, a food distribution customer of SpartanNash for 58 years, has 49 stores across Ohio, Indiana and Kentucky.
- The transaction builds on other acquisitions the retailer-distributor company has made over the past several years to expand its regional store network.
Dive Insight:
The purchase of Fresh Encounter comes at a time when SpartanNash is looking to improve its financial performance and boost its retail operations.
The acquisition will expand SpartanNash’s retail portfolio by a third and mark its debut in Kentucky. The transaction is expected to close in late November, subject to customary closing conditions.
Fresh Encounter, which is owned by third-generation grocers Michael Needler Jr. and Julie Anderson, runs the Community Markets, Remke Markets, Chief Markets and Needler's Fresh Market banners.
SpartanNash will continue to employ Fresh Encounter’s 2,500 team members, according to the press release.
SpartanNash CEO Tony Sarsam said the Fresh Encounter acquisition is a key part of the company’s strategic growth plans.
“Retail is a critical component of our business model and long-term strategic plan, as we meet consumer needs and leverage insights from our stores to continuously innovate our products and operations across our wholesale business,” Sarsam said in the announcement.
In its most recent quarterly earnings report, SpartanNash recorded a decline in net and comparable-store sales and reported that both its retail and wholesale operations lost ground for the third quarter in a row. But Sarsam told investors in August that the company’s “merchandising transformation” is starting to pay off.
The Fresh Encounter acquisition adds to a string of recent acquisitions by SpartanNash. The company bought Metcalfe’s Market, a three-store Wisconsin grocery chain, earlier this year. SpartanNash bought distributor Great Lake Foods last year, Shop-N-Save Food Centers in 2022 and Martin’s Super Markets in 2018.
SpartanNash currently runs more than 140 brick-and-mortar grocery stores, primarily under the Family Fare, Martin’s Super Markets and D&W Fresh Market banners, as well as pharmacies and fuel centers. Last week, the company announced the reopening of the store that marks its second pilot location for its grocery store modernization strategy, which focuses on fresh products, convenience and value.
