Fiesta Mart to be Acquired by Mexican Retailer
Hispanic retailer Bodega Latina Corp., doing business as El Super and a subsidiary of Mexican company Grupo Comercial Chedraui S.A.B. DE C.V., will acquire Fiesta Mart LLC. Houston-based Fiesta, a portfolio company of private equity firm Acon Investments LLC, operates 63 Hispanic-themed stores mainly in the Dallas and Houston areas.
The deal will create one of the largest Hispanic-focused supermarket companies in the United States, with a total of 122 stores in California, Arizona, Nevada, New Mexico and Texas and revenues of about $3 billion, according to the entities involved. More than half of the fast-growing U.S. Hispanic population lives in the five states in which the stores operate.
“The acquisition of Fiesta allows us to meaningfully expand into Texas via an established, well-known supermarket operator,” said Carlos Smith, president and CEO of Paramount, Calif.-based Bodega Latina. “Through the combination of the strengths of our two organizations, we will be well positioned to significantly accelerate our vision of efficiently offering high-quality products at the lowest possible prices. We believe this transaction will be beneficial for all of our stakeholders, including customers, suppliers, employees and vendors. We look forward to welcoming Fiesta's talented employees and working together to create the premier Hispanic grocery retailer."
Added José Antonio Chedraui Eguía, CEO of Xalapa, Mexico-based Chedraui: “We are excited about the combination of Bodega Latina and Fiesta, which further expands our U.S. footprint. Grupo Comercial Chedraui is committed to growing our U.S. business both organically and through acquisition.”
"Combining the strengths of Bodega Latina with those of Fiesta will accelerate the evolution and growth of Fiesta through combining the parties’ scale, geographic reach, talented teams and market knowledge,” noted Fiesta CEO Sid Keswani, who took the helm of the company last August. “Our team members are excited about becoming part of the Bodega Latina family and continuing to grow the combined company."
The deal is anticipated to close at the beginning of the second quarter of 2018, subject to customary closing conditions. Fiesta stores will continue to operate under that banner.
This is the second time in three years that Fiesta Mart has been sold. Washington, D.C.-based Acon acquired the chain in April 2015 from its family ownership. At that time, Bi-Lo and Minyard Food Stores veteran Michael Byars was appointed CEO, replacing Louis Katopodis, who retired.
Bodega Latina has competition in its bid to be the largest U.S. Hispanic grocer, however: Ontario, Calif.-based Cardenas Markets is pursuing its own growth strategy since merging with Mi Pueblo and acquiring Los Altos Ranch Market last year, creating a 53-store chain in Arizona, California and Nevada. Also in 2017, Cardenas CEO John Gomez shared his plans with Progressive Grocer to have 80 to 90 stores open over the next three to five years.