Edina-based grocer Nash Finch Co. is being acquired by Spartan Stores, a Michigan wholesale and retail food seller, in a deal valued at about $1.3 billion, MPR reports.
Reuters says Spartan Stores is the ninth-largest grocery distributor in the United States.
“This transaction is consistent with our vision to become the largest and most admired food distributor in the U.S.,” Alec Covington, president and CEO of Nash Finch, said in a statement.
Nash Finch operates several Upper Midwest supermarkets including Family Fresh Markets, Econofoods, Bag’n Save, Family Thrift Center and Sun Mart Foods and is a major distributor of food to American military commissaries. It also owns the Our Family private-label brand.
The combined company will include 22 distribution centers that cover 37 states and 177 retail stores.
The Pioneer Press reports the all-stock deal means the loss of a corporate headquarters in Minnesota and a business with $5 billion is annual sales.
Shares of both companies surged after Monday’s announcement, the Star Tribune said. Nash Finch shares rose 24 percent to $31.50 premarket Monday, while Spartan Stores shares jumped 20 percent to $25.50, according to the Wall Street Journal.
Nash Finch stockholders will receive 1.2 shares of Spartan Stores for each share they hold. The Star Tribune says Spartan shareholders will own about 57.7 percent of the combined company, with Nash Finch stockholders owning the remaining 42.3 percent.