Dutch grocer Ahold has acquired Delhaize, a Belgian grocer for $28 billion. With the purchase, the companies will merge to create one of the largest food retailers worldwide. The move will have a significant impact on the U.S. east coast, putting four of the largest chains under the same umbrella: Stop & Stop, Giant, Food Lion and Hannaford.
The merger will form a base of 6,500 stores that will serve more than 50 million customers in the U.S. and Europe each week, according to an Ahold announcement. Moving forward, Ahold Delhaize will be the retail giant’s new identity.
The combination of the two companies will form “a stronger, bigger, more innovative company with market-leading retail offerings and strong, trusted local brands,” according to a presentation from the companies outlining the nature of the deal. The two organizations have “complementary cultures, similar values and neighboring geographies, as well as a shared focus on the customer.”
As one cohesive company, Ahold Delhaize also will be positioned to lower operating and purchasing costs in an effort to better compete with Walmart, according to the presentation. Peapod, Ahold’s online grocery service, also will help the company better compete with Amazon and its expanding grocery business.
Ahold CEO Dick Boer will lead the combined company. Delhaize CEO Frans Muller will act as deputy CEO and Chief Integration Officer, helping the two businesses combine into one cohesive unit.
In Europe, the merged grocer will be the continent’s largest food retailer, ahead of Tesco and Carrefour, according to Reuters. The retailer also will account for 5% of the U.S. grocery market.
Under the merger, Delhaize shareholders will receive 4.75 shares of the combined company for each Delhaize share owned. Ahold will take a 61% stake in the new company, while Delhaize will acquire the remaining 39%.