CINCINNATI -- Kroger Co. here said last week it has reached tentative agreement with Fleming to purchase 15 Baker's Supermarkets and one Food 4 Less store in Omaha, Neb. -- marking Kroger's first entry into the state of Nebraska.
formats.
Fleming said last week it is close to reaching agreements for the sale of 53 Abco Desert Markets in Arizona and 24 Sentry Supermarkets in Wisconsin. A Fleming spokeswoman told SN last week both chains are likely to be sold in pieces to a variety of retailers, with announcements possible in the next few weeks.
Mark Hansen, chairman and chief executive officer of Fleming, said the sale of the Baker's chain to Kroger "underscores our belief that the conventional supermarket segment offers local market growth potential for independents and national growth potential for consolidators."
He also said Fleming has signed a three-year supply agreement with Kroger under which it will continue to supply the 16 stores from its Lincoln, Neb., product supply center.
Kroger said the Nebraska units will operate as part of its Dillon Stores division based in Hutchinson, Kan., and will continue to operate under their existing banners with their current employees.
"This transaction will open a new market for Kroger and provide exciting growth opportunities in the Midwest," Joseph A. Pichler, Kroger chairman and chief executive officer, said last week.
Bob Colvey, president of Dillon Stores, said Kroger's size, purchasing power and merchandising programs should enable the new owners to build on Baker's strong foundation.
Baker's was founded in 1927 and sold to Fleming in 1992.
Fleming said last week proceeds from the sale of its conventional store groups are expected to total approximately $200 million.
The company also said last week it expects adjusted earnings for the fourth quarter to be 52 cents per share, consistent with the guidelines it provided in October, despite the current soft consumer spending environment.
