CINCINNATI— The Kroger Company announced Friday it has completed the sale of its convenience store business unit to EG Group for $2.15 billion, according to a media release.
After tax proceeds total $1.7 billion. $1.2 billion of the proceeds will be used to fund an accelerated share repurchase (“ASR”) program.
“Throughout the sales process, we have been impressed with EG Group’s professionalism, commitment to people, and understanding of the U.S. convenience retail market,” said Mike Schlotman, Kroger’s executive vice president and chief financial officer. “I can’t stress enough how important to our success Kroger’s convenience store management and associates have been, and we want to thank them for all of their contributions to our customers and our company.”
Kroger announced in October 2017 its intention to explore strategic alternatives for its convenience store business, including a potential sale, in conjunction with Restock Kroger. In February, Kroger and EG Group announced a definitive agreement for the sale of Kroger’s convenience store business unit to EG Group.
Included in the sale were 762 convenience stores, including 66 franchise operations, operating in 18 states and employing 11,000 associates under the following banner names: Turkey Hill, Loaf ‘N Jug, Kwik Shop, Tom Thumb and Quik Stop.
Kroger’s supermarket fuel centers and its Turkey Hill Dairy were not included in the sale. EG Group will establish their North American headquarters in Cincinnati, Ohio and continue to operate stores under their established banner names.
Fuel points can still be redeemed at formerly-owned Kwik Shop stores to save up to $1 per gallon of fuel. Customers will no longer be able to earn fuel points using a Shopper’s Card at those transitioning stores.
Food and beverage clubs for coffee or fountain drinks at Kwik Shop will expire on April 25. Accumulated rewards can be redeemed through the month of May.