COLUMBUS, Ohio -- Giant Eagle will more than double its presence in this market with the proposed acquisition of seven Big Bear supermarkets for $46.8 million.
Giant Eagle's bid for the stores, which is subject to bankruptcy court approval, eclipsed an attempt by Kroger Co., Cincinnati, to acquire a package of 11 Big Bear stores for $20 million. Big Bear's parent company, Penn Traffic, Syracuse, N.Y., filed for bankruptcy protection in May and last month said it would seek to dispose of the Big Bear chain.
Pittsburgh-based Giant Eagle, a privately owned chain with about 220 stores and estimated annual sales of about $4.5 billion, said it planned to close the newly acquired Big Bears briefly before reopening them early next year. The pharmacies are expected to remain open.
Giant Eagle entered the Columbus market three years ago with a commitment to build six new stores, the last of which is scheduled to open next year, according Rob Borella, a spokesman for the company. Unlike those larger, suburban locations, which measure 85,000 to 100,000 square feet, the Big Bear units are located in more densely populated areas of the market closer to downtown Columbus and measure 30,000 to 60,000 square feet, he said.
"We will look to make progressive enhancements to the stores that we acquire," said Borella. "It's going to be on a case-by-case basis as to whether we can bring all of our service offerings to that particular space."
He said the stores' locations in more populated areas may constrain their expansion potential. He described the stores as being "overall in pretty good shape," although he noted that Big Bear's product offerings may have deteriorated during the bankruptcy.
In central Ohio, Kroger reportedly has about a 45% market share vs. 15% for Big Bear, with the rest divided among Giant Eagle, Wal-Mart and independent operators.
Kroger acquired one Big Bear store last week in Springfield, Ohio, after the auction where Giant Eagle outbid it, according to reports. Kroger declined to comment.
Penn Traffic also agreed to sell two additional Big Bear stores to Bob Bay and Son Co., and another to Needler Enterprises. Many of the remaining stores have launched liquidation sales and are expected to close.
Penn Traffic also sold the prescription files for 31 Big Bear pharmacies to various other retailers, including Meijer, Grand Rapids, Mich.; CVS, Woonsocket, R.I.; Kroger; and Giant Eagle, for $9.9 million, according to reports.