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AWG/AFM Merger Complete

The merger of Associated Wholesale Grocers (AWG) and Affiliated Foods Midwest (AFM) is a done deal. With its first shipments to stores out of its newest divisions in Norfolk, Neb., and Kenosha, Wis., on Sunday, Oct. 23, the combined grocery co-op, which serves more than 1,000 independent member-grocers in 35 states, is now operating singularly as AWG.

Following the completion of the merger, AWG is now the largest wholesale grocery co-op in the United States. Along with the expanded retailer member base and geographic footprint, the combination enables AWG to expand its offerings to its retail members with the addition of a retail accounting subsidiary and a digital marketing subsidiary.

“From the moment Barry Queen [AWG’s board chairman] and I started our discussions with AFM’s president and CEO, Martin Arter, and chairman, John Clarke, we knew our companies were a great fit,” said David Smith, AWG’s president and CEO.” AWG’s new region will continue to be led by Arter, according to Smith, who noted: “Marty is an extraordinary individual, and he is the perfect leader for this new endeavor.”

The merged co-ops will now enable AWG to better serve retailers in northern states such as North Dakota, South Dakota, Minnesota, Wisconsin and Michigan, according to Smith. “The expansion of our collective distribution areas into several new adjoining states where there remains a large number of independent grocers, but few wholesale options, is already paying dividends, as retailers in those states are already making inquiries and asking how soon we can onboard new customers. With the current enthusiasm we are witnessing, our new Great Lakes division in Kenosha may top $1 billion in annual sales sooner than we initially anticipated,” Smith explained.

The combination also allows AWG to expand its footprint west to service independent grocers in Wyoming and Colorado.

“We are so thankful for the support of our membership, our dedicated employees and our fantastic vendor partners,” affirmed Smith. “It takes all three of these constituencies working together in unison to become and remain successful. We have that going for us, and believe that we will accomplish great things as we are truly stronger together.”

Based in Kansas City, Kan., retailer-owned AWG serves member stores with a complete assortment of grocery, frozen foods, dairy and refrigerated products, fresh meat, and fresh produce, together with a full array of specialty foods, health and beauty care products, international foods, dollar products, and general merchandise items supplied by its Valu Merchandisers Co. (VMC) subsidiary. AWG/VMC, with the addition of the AFM facilities and its members, operates an extensive distribution network of 11 distribution centers, serving more than 3,800 retail outlets, representing well over $20 billion in retail supermarket sales, and generating annualized wholesale sales of about $10 billion on a consolidated basis.

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