Harris Teeter Supermarkets, Inc.
) operating subsidiary, Harris Teeter Inc., is geared to expand
its operations in the Charleston, SC region. As part of this
strategy, it has inked an agreement with Greenbax Enterprises,
Inc. ("Piggly Wiggly") to buy six store locations and one future
store location in the area.
Piggly Wiggly is a family-owned retail company with more than
3,000 employees and 100 stores throughout South Carolina and
coastal Georgia. Based in Charleston, SC, it sells variety of
goods like general grocery, meat, seafood, produce, deli, bakery,
floral and pharmacy.
After suffering declines in market share and comps for several
months, Piggly Wiggly decided to trim its structure. It announced
its intention to sell 29 of its locations. HTSI will take over
three stores in Charleston; two stores in Mount Pleasant, SC; one
in the Newton Farms location on Kiawah Island, SC; and one store
location under construction in Isle of Palms, SC. The balance 22
stores will be sold to supermarket chain, BI-LO LLC.
However, both the bidders have signed agreements to sell their
assets to larger chains. Harris Teeter, carrying a Zacks Rank #4
(Sell), has signed a divestiture agreement with
The Kroger Co.
Per the contract, Kroger will acquire all the shares of the
regional grocer for $2.44 billion in cash.
Kroger will pay $49.38 for each Harris Teeter share and will
assume the latter's outstanding debt of about $100 million.
Again, Publix Super Markets, Inc is expected to buy seven
BI-LO-branded stores in North and South Carolina.
The grocery supermarket sector in the U.S. seems to be
undergoing a reshuffle as many large supermarkets are changing
hands. Recently, in 2013,
) trimmed down their operations by selling off some of the
The declining discretionary spending owing to the sluggish
economic growth in the U.S. has increased the competition for
these supermarket chains. Therefore, the large grocery chains are
buying parts or whole of smaller supermarket chains to reap the
benefit of location and price.
HARRIS TEETER (HTSI): Free Stock Analysis
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