MONTVALE, N.J. A&P has completed its acquisition of Pathmark Stores, forming a 450-store chain—including 260 pharmacies—with $9.4 billion in annual sales volume.
The deal, valued at $1.4 billion in cash, stock and assumed or retired debt, calls for Pathmark shareholders to receive $9 in cash and 0.12963 shares of A&P stock for each Pathmark share.
The company stated that it plans to maintain the Pathmark name and will retain substantially all Pathmark store operations personnel and about 175 corporate associates.
The combined company has leading market share in the New York metro area, as well as significantly increased market share in greater Philadelphia and Baltimore.
“Our goal now is to efficiently integrate the businesses based on the comprehensive plan developed over the last eight months under the direction of senior management and outside experts. We look forward to the future of our combined company will full confidence in the long-range success we will achieve and the value and benefits we will create for all of our key stakeholders,” stated Christian Haub, executive chairman of A&P.
In announcing the completion of the merger agreement, the grocer highlighted the following key aspects of the deal:
- The addition of the Pathmark brand and its high volume, price impact operating format, which complements A&P’s Fresh, Discount and Gourmet operations, provides the most diverse range of targeted food retail formats in the Northeast, according to the company.
- An expanded portfolio of real estate and store locations across the Northeast’s most densely-populated markets.
- The retention of 97 percent combined company EBITDA from store operations, based on historical financials proforma for required divestures.
- An improved financial profile based on $150 million in integration synergies that are anticipated to be achieved within 18 to 24 months.
- The merger of A&P’s and Pathmark’s respective technology strengths.
- The retention of key Pathmark management personnel to support integration activities and operate the combined business going forward.
With the deal complete, A&P operates 450 stores in six states and District of Columbia under the trade names A&P, Pathmark, Waldbaum’s, The Food Emporium, Super Foodmart, Super Fresh and Food Basics.