Roundy's Acquiring 11 Dominick's Stores

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Roundy's Acquiring 11 Dominick's Stores


Mariano's Fresh Market will nearly double its existing store base with the acquisition of 11 Dominick's stores from Safeway Inc., which is closing the venerable Chicago-area banner by year's end.

Milwaukee-based Roundy’s Inc. has signed a definitive agreement to acquire 11 Dominick’s locations in Chicago and its suburbs in a $36 million cash and lease assumption transaction.

“This acquisition is transformational in terms of Mariano’s expansion plans in the Chicago metropolitan area, allowing us to open 11 additional stores in 2014 in prime locations with great market demographics,” said Robert Mariano, chairman, president and CEO of Roundy’s. “These key locations will seamlessly integrate into and complement our existing base of 13 Mariano’s locations as well as our five additional 2014 Mariano’s locations now under construction.”

The company expects to close the transaction in the second half of December, followed by a transition period of up to two months during which Roundy's will convert the stores to its wildly successful Mariano’s brand, which Roundy's describes as its growth banner.

Roundy’s plans to fund the acquisition through a debt financing transaction, the proceeds of which will also be used to reduce the company’s debt under its first lien credit facility. With the near doubling of the Mariano’s store base following this acquisition and the strong continued growth prospects that exist for the Mariano’s banner, Roundy’s has determined that allocating additional capital to its attractive growth opportunities is the best use of cash from a long-term shareholder return perspective. As a result, Roundy’s will suspend its quarterly dividend so that it can use that cash to grow the Mariano’s business.

The following Dominick's locations are included in the Mariano's conversion transition:

• Park Ridge: 1900 S. Cumberland Ave.
• Western Springs: No. 14 Garden Market Street
• Chicago: 3145 S. Ashland Ave.
• Chicago: 2021 W. Chicago Ave.
• Northfield: 1822 Willow Rd.
• Westchester: 3020 S. Wolf Rd.
• Buffalo Grove: 450 Half Day Rd.
• Chicago: 5201 N. Sheridan Rd.
• Gurnee: 6655 Grand Ave.
• Aurora: 3025 E. New York St.
• Shorewood: 950 Brook Forest Ave.

Founded in Milwaukee in 1872, Roundy’s operates 163 retail grocery stores and 101 pharmacies under the Pick ’n Save, Rainbow, Copps, Metro Market and Mariano’s retail banners in Wisconsin, Minnesota and Illinois.