BI-LO, and Winn-Dixie Stores, announced that the companies will merge to create an organization of approximately 690 grocery stores and 63,000 employees in eight states throughout the southeastern United States.
Under the terms of the definitive agreement, BI-LO will acquire all of the outstanding shares of Winn-Dixie stock in the merger. Winn-Dixie shareholders will receive $9.50 in cash per share of Winn-Dixie common stock, representing a premium of approximately 75% over the closing price of Winn-Dixie common stock on December 16, 2011.
A Special Committee of the Winn-Dixie Board of Directors, comprised of eight independent directors, and advised by independent financial and legal advisors, negotiated the transaction and recommended it to the full Board. The full Board unanimously approved the agreement and recommends Winn-Dixie shareholders vote in favor of the transaction.
“We are very excited about the merger of BI-LO and Winn-Dixie,” said Randall Onstead, Chairman of BI-LO. “With no overlap in our markets, the combined company will have a perfect geographic fit that will create a stronger platform from which to provide our customers great products at a great value, while continuing to offer exceptional service. BI-LO and Winn-Dixie are both strong regional brands with similar heritages, compelling customer connections, and outstanding employees. Both have been an important part of the communities and families they serve, and we look forward to building upon these two iconic brands and serving loyal customers for years to come.”
“This transaction with BI-LO provides Winn-Dixie shareholders with a significant cash premium for their shares. We believe this transaction is in the best interests of our shareholders,” said Peter Lynch, Chairman, CEO and President of Winn-Dixie. “By combining BI-LO and Winn-Dixie, we anticipate building a company that is stronger than our individual businesses and creating opportunities for continued advancement through the cross-pollination of our people and the sharing of ideas across our organizations, all to the benefit of our guests, suppliers, team members and the neighborhoods that Winn-Dixie serves.”
The transaction is currently expected to close in the next 60 to 120 days, subject to the approval of Winn-Dixie shareholders and other customary closing conditions, including expiration of the applicablewaiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976. The transaction is not subject to any financing condition. Following the completion of the merger, Winn-Dixie will become a privately-held, wholly owned subsidiary of BI-LO and Winn-Dixie’s common stock will cease trading on the NASDAQ.
Until the merger is complete, both BI-LO and Winn-Dixie will continue to operate as separate companies.
Following completion of the merger, it is anticipated that the companies will continue to operate under the BI-LO and Winn-Dixie banners.
BI-LO and Winn-Dixie do not currently expect any store closures as a result of the combination. The combined company’s executive management team structure and headquarters location will be decided as the companies move closer to finalizing the transaction; however, it is expected that the combined company will maintain a presence in both Greenville and Jacksonville.
William Blair, Citi, The Food Partners, Deutsche Bank Securities, Inc. and Alvarez & Marsal Transaction Advisory Group are acting as financial advisors and Gibson, Dunn & Crutcher LLP and Hunton & Williams LLP are acting as legal advisors to BI-LO. Goldman, Sachs & Co. is acting as exclusive financial advisor and Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal advisor to the Special Committee of the Winn-Dixie Board of Directors. King & Spalding LLP and Greenberg Traurig, P.A. are acting as legal advisors to Winn-Dixie.