Apollo Global Management has entered into a definitive agreement to acquire specialty grocery retailer The Fresh Market (NASDAQ: TFM) for about $1.36 billion in cash. The purchase price of $28.50 per share represents approximate premiums of 24% over The Fresh Market’s closing share price on March 11 and 53% over its price on February 10, the day before speculation about a potential transaction began.
Company co-founder Ray Berry and son Brett Berry collectively own about 9.8% of The Fresh Market and will roll over most of those holdings in the deal. In addition to that rollover, the acquisition will be financed by roughly $525 million in equity from Apollo and around $800 million in debt. The transaction has been approved by the company’s Board of Directors.
It’s been a busy past few days for PE in the grocery retail sector. Last Friday, Haggen agreed to sell 29 of its core stores in the northwest U.S. to Cerberus Capital Management-backed Albertsons for a reported $106 million, the latest development in the ill-fated chain’s ongoing saga. Just last year, Haggen started a takeover of nearly 150 stores on the West Coast previously operated by Albertsons or Safeway, an antitrust move required by the Federal Trade Commission as a condition of the two giants' $9 billion merger. Months later, though, Haggen filed for bankruptcy and began pursuing options to offload locations in order to appease creditors.