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Kroger to Buy Harris Teeter for $2.5B

The combined company will operate 2,631 supermarkets


Kroger KR stock to sellKroger (KR) is about to expand its reach to include three new U.S. states.

The supermarket giant announced on Tuesday that it will pay $2.5 billion to purchase Harris Teeter Supermarkets (HTSI). Under the deal, which has been approved by both companies’ boards, Kroger will acquire Harris Teeter shares for a 2% premium over their Monday closing price, USA TODAY notes.

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Kroger will assume $100 million in Harris Teeter’s debt under the deal, which will be financed with debt of its own.

After the purchase, Kroger will operate 2,631 supermarkets in 34 states — up from a current 31 — and the District of Columbia. Harris Teeter will become a Kroger subsidiary.

The acquisition will produce cost savings of between $40 million and $50 million during the next four years, Kroger estimates.

News of the acquisition sent Kroger shares up more than 2% in Tuesday morning trading, while Harris Teeter climbed more than 1%.

Article printed from InvestorPlace Media,

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