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Kroger the Consolidator

CINCINNATI — While the $13 billion Fred Meyer acquisition five years ago is still known around Kroger as “The Merger,” the company here has remained active on the acquisition front, focusing mainly on in-market purchases of small handfuls of stores.

CINCINNATI — While the $13 billion Fred Meyer acquisition five years ago is still known around Kroger as “The Merger,” the company here has remained active on the acquisition front, focusing mainly on in-market purchases of small handfuls of stores.

These smaller acquisitions don’t often generate the headlines of a Fred Meyer purchase. Yet for Kroger, they make good business sense because market share indexes with Kroger’s ability to leverage its costs in procurement, advertising and distribution, said Don McGeorge, president and chief operating officer. In the five years since the Fred Meyer merger, Kroger has acquired nearly 250 stores in more than 40 separate transactions, ranging from single-store pickups to the 41-store buy of Albertsons locations divested by regulator mandate.

Does Kroger eye acquisitions as a means to enter new markets? “Never say never,” McGeorge said. However, further in-market acquisitions are much more likely. “We’re not anti- any market,” he added. “We just like to be able to fill in where it gives us the greatest leverage and return on assets.”

Following is a list of Kroger’s purchases since the 800-store Fred Meyer merger closed in May of 1999:

BANNER DATE NUMBEROF STORES LOCATION
Albertsons June 1999 41 Western U.S.
Jay C June 1999 31 Indiana
Individual stores 1999 6 Various locations
Pay less January 2000 8 Anderson/Lafayette, Ind.
Kessel February 2000 20 Flint/Saginaw, Mich.
Hannaford August 2000 20 Richmond/Hampton, Va.
Individual stores 2000 5 Various
Baker’s March 2001 6 Omaha, Neb.
Harris Teeter July 2001 8 Atlanta
Furr’s September 2001 7 Albuquerque, N.M.
Individual stores 2001 3 Various
Albertsons May 2002 17 Houston/Sulphur, Texas
Winn-Dixie June 2002 7 Dallas
Raley’s November 2002 18 Las Vegas
Individual stores 2002 5 Various
Food Town June 2003 13 Toledo, Ohio
Eagle Food September 2003 6 Illinois
Cub Food October 2003 7 Denver
Individual stores 2003 7 Various
Thriftway July 2004 6 Cincinnati
Albertsons August 2004 3 Omaha, Neb.
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