JACKSONVILLE, Fla. – Aldi is buying 400 Harveys Supermarket and Winn-Dixie grocery stores in Alabama, Georgia, Louisiana, Mississippi and Florida from their parent company, Southeastern Grocers Inc.
Under a proposed merger agreement, Aldi will acquire all outstanding shares of Jacksonville-based SEG. If the deal is approved by regulators, it’s expected to close in the first half of 2024.
Financial terms of the deal weren’t disclosed. Both Southeastern Grocers and Aldi are private companies. Aldi is based in Germany with a U.S. headquarters in Batavia, Illinois.
Aldi said the deal supports its long-term growth strategy in the U.S., where it expects to have 2,400 stores by the end of this year.
A recent Jacksonville Business Journal article noted that Winn-Dixie stores are generally at least double the size of Aldi stores. They are usually built just under 50,000 square feet while Aldi grocery store buildings typically stand smaller than 20,000 square feet.
Aldi will continue to operate the stores in their current locations but will evaluate which locations it wants to convert to the Aldi format. Stores that aren’t converted will continue to operate as Winn-Dixie and Harveys Supermarket stores.
Aldi’s format cuts costs with features like limited selection and self-bagging.
Neil Saunders, an analyst with GlobalData Retail, said the deal is unusual for Aldi, which usually opens its own stores. He said it suggests Aldi wants to experiment with more traditional supermarkets that don’t follow its low-cost model. He also said Aldi’s deep pockets and efficient supply chain will make Southeastern’s stores more competitive.
SEG also plans to sell its 28 Fresco y Mas stores to Fresco Retail Group, an investment company, which will continue to operate them under the same brand.
SEG will continue to operate its respective banners and stores until everything goes through with regulators.
“Our successful transformational journey has created a unique opportunity with leading partners who share our vision and common commitments to creating value for their customers,” said Anthony Hucker, President and CEO of Southeastern Grocers. “We believe these next steps will fuel a phenomenal experience for our customers, new opportunities for our associates and increased value for our shareholders. As the sales processes proceed, we’ll stay acutely focused upon delivering the exceptional quality, service and value that our customers and communities have come to expect from us.”
