Retail Highlights- July 2014
Contents
Dollar Tree to Buy Family Dollar for $9.2 Billion ..................................................................................... 1
JBS Buys Tyson Foods LatAm Poultry Assets for $575 Million ................................................................ 1
Kroger to Acquire Online Vitamin Seller Vitacost.com for $280 Million ................................................ 2
Tyson Foods to Acquire Hillshire Brands for $8.55 Billion ...................................................................... 2
Dollar Tree to Buy Family Dollar for $9.2 Billion
US-based Dollar Tree a discount variety stores will acquire Family Dollar a retailer name and
private brand merchandise, in a cash and stock transaction valued at $9.2 billion.
Post-acquisition of Family Dollar Stores, Dollar Tree will become a leading discount retailer in
North America, with over 13,000 stores in 48 states and five Canadian Provinces, sales of
over $18, and more than 145,000 associates. Post combination the stores will continue to
operate under the Dollar Tree, Deals, and Dollar Tree Canada brands, and under the Family
Dollar brand as well.
The transaction is subject to Family Dollar stockholder approval and other customary closing
conditions.
Dollar Tree intends to finance the acquisition through a combination of existing cash on hand,
bank debt and bonds. J.P. Morgan Securities acted as exclusive financial advisor to Dollar
Tree. Morgan Stanley acted as financial advisor to Family Dollar.
Dollar Tree, a Fortune 500 Company, operates 5,080 stores in 48 states and five Canadian
Provinces, with total retail selling square footage of 44.0 million.
Family Dollar Stores, a Fortune 500 Company, offers a mix of name brands and quality,
private brand merchandise appeals to shoppers in more than 8,200 stores in rural and urban
settings across 46 states.
JBS Buys Tyson Foods LatAm Poultry Assets for $575 Million
Tyson Foods agreed to sell its poultry businesses in Mexico and Brazil for $575 million in an
all cash deal to JBS.
Tyson Foods' Mexican business will be acquired through Pilgrim's Pride, whose majority
owner is JBS USA Holdings, a wholly owned subsidiary of JBS SA. The Brazilian business is
to be acquired through JBS Foods, also a wholly owned subsidiary of JBS.
The Mexican business, known as Tyson de México, is a vertically integrated poultry business
based in Gomez Palacio in North Central México. It has three plants and employs more than
5,400 team members in its plants, offices and seven distribution centers.
The acquisition of Tyson's Brazil operations, known as Tyson do Brasil, involves three fully
integrated production plants, two in Santa Catarina and one in the state of Parana. Tyson do
Brasil employs 5,000 team members.
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Kroger to Acquire Online Vitamin Seller Vitacost.com for $280 Million
The Kroger Co will purchase all outstanding shares of Vitacost.com, a leading online retailer
of healthy living products for $8.00 per share in cash, or approximately $280 million.
Vitacost.com's core focus being in the healthy living products is complementary to Kroger’s
fast-growing natural foods business and position in the online nutrition market. Vitacost.com
brings to Kroger its strong position as one of the largest pure e-Commerce companies in the
nutrition and healthy living market, a team with extensive e-Commerce experience, and a
substantial platform that includes technology and ship-to-home fulfillment centers to serve
customers in all 50 states and internationally. For Kroger' this merger is in line with their
growth strategy to enter new markets and new channels, and – along with Harris Teeter's
online order and pick up service – accelerates its efforts to provide customers with the
convenience to order online and ship to their door with an expanded assortment online. Prior
to Vitacost.com acquisition Kroger has no operation outside US. Kroger can build on
Vitacost.com's e-Commerce platform by integrating it with their existing digital offerings.
Vitacost.com reported annual revenue of $382.7 million in FY-2013. Vitacost.com reported
approximately 2.3 million total active customers as of the end of its Q1- 2014 and reported
shipping 1.5 million orders.
The Kroger one of the world's largest retailers, employs more than 375,000 associates who
serve customers in 2,642 supermarkets and multi-department stores in 34 states and the
District of Columbia. The company also operates 787 convenience stores, 324 fine jewelry
stores, 1,261 supermarket fuel centers and 37 food processing plants in the U.S.
Vitacost.com, Inc. is a leading online retailer of health and wellness products, including dietary
supplements such as vitamins, minerals, herbs and other botanicals, amino acids and
metabolites, as well as cosmetics, organic body and personal care products, pet products,
sports nutrition and health foods. Vitacost.com, Inc. sells these products directly to consumers
through its website.
Tyson Foods to Acquire Hillshire Brands for $8.55 Billion
In an all cash deal Tyson Foods will acquire Hillshire Brands for $8.55 billion, including the
debts. In addition, Tyson Foods will be making, on behalf of Hillshire Brands, a payment of
the $163 million termination fee associated with the termination of Hillshire Brands' merger
agreement with Pinnacle Foods.
The combination of Tyson Foods and Hillshire Brands will reposition Tyson as a major player
in the retail sale of prepared foods.
Tyson Foods founded in 1935 with headquarters in Springdale, Arkansas, is one of the world's
largest processors and marketers of chicken, beef, and the second-largest food production
company.
The Hillshire Brands is a leader in branded, convenient foods. The company generated
approximately $4 billion in annual sales in FY- 2013, has more than 9,000 employees, and is
based in Chicago.
Morgan Stanley and JP Morgan are financial advisors to Tyson Foods. Centerview
Partners and Goldman, Sachs are financial advisors to Hillshire Brands.
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