EAU CLAIRE, Wis. -- In an usual business deal that can be summed up as "I'll trade you three Mega Co-ops for 14 Gordy's," grocery retailers Gordy’s Market and Mega Co-op have reached an agreement that will allow each company to focus on its primary business through an asset swap.
Under the new agreement, the Mega Co-op grocery stores will become Gordy’s Markets and the Gordy’s Express convenience stores and gas stations will become Mega Holiday c-stores and gas stations.
All 14 of Gordy’s Express c-stores and gas stations will become Mega Holiday c-stores and gas stations. Three of the four Mega Co-op grocery stores will become Gordy’s Markets grocery stores.
All of the Gordy’s stores and all but one of the Mega Co-op stores will remain open.
When this transaction is complete, Gordy’s will own and operate no c-stores or gas stations and a total of 24 grocery stores and Mega Co-op will own and operate no grocery stores and a total of 33 c-stores and gas stations.
“This is an exciting opportunity and a true win-win for both organizations," said David Schafer, CFO of Chippewa Falls, Wis.-based Gordy’s Market. "This transaction will allow two strong, locally owned companies to bring enhanced value to our customers throughout western Wisconsin.”
Mike Buck, president of Eau Claire, Wis.-based Mega Co-op, said, “Both companies will be bigger and stronger as a result of this agreement. This helps ensure a positive future for both of our businesses and will allow us to focus on reinvestment, growth in a highly competitive environment and returning patronage to our cooperative members."
As reported in a McLane Co./CSP Daily News Flash, while the companies will remain separate and independent, they plan to collaborate on new locations and support each other with joint loyalty programs, including the Pump Perks and Gas Rewards Program.
The companies will maintain their current corporate office locations. Gordy’s and Mega Co-op combined employ close to 2,500 people in western Wisconsin. Schafer and Buck said they are working hard to minimize any job losses with this transaction.
Both companies have deep roots in the communities they serve. Gordy’s will celebrate its 50th anniversary in 2016 and Mega Co-op has an 81-year history in Eau Claire.
This transaction is expected to close in late February.
In a separate but related deal, Grand Rapids, Mich.-based SpartanNash, the nation's fifth largest food distributor and leading distributor to U.S. military commissaries and exchanges in the world, has announced that it has signed a long-term contract to be the primary wholesaler to Gordy’s Market.