Kroger (KR), KKR (KKR) and TPG Capital were said to be vying for The Fresh Market (TFM), but Apollo Global Management (APO) will ultimately acquire the specialty grocery chain.
Funds managed by Apollo affiliates will purchase The Fresh Market for $28.50 per share in cash, or about $1.36 billion, said Apollo and TFM in a joint statement. The offer represents a 24% premium over the grocer’s Friday closing price. The acquisition follows the grocer’s strategic and financial review of its company, which began last October.
The Fresh Market’s shares rocketed 23.5% to 28.39 in the stock market today, gapping up past their 200-day line. The stock had been trading above its 50-day line after popping 22% on Feb. 11 on reports that supermarket heavyweight Kroger was in talks to buy the 186-store grocery chain. Apollo, TPG and KKR were also said to be bidders in the auction at that time, according to Reuters.
The deal is seen closing in the second quarter of 2016, pending certain conditions. The terms of the agreement allow the Fresh Market to actively seek out alternative proposals until April 1.
“We believe there is a significant opportunity to enhance the brand, merchandise offering and price-value combination to make The Fresh Market a primary destination for food shoppers while at the same time being committed to social responsibility through partnerships with local vendors and communities,” said Andrew Jhawar, the head of Apollo’s retail and consumer division, in the announcement.
Apollo shares rose 0.4% to 16.98. Kroger shares fell 0.7% to 38.39.
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