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UNFI Purchases Supervalu for $2.9B

This morning, the leading distributor of organic and natural foods, UNFI, purchased Supervalu for $2.9 billion.

Once the acquisition is complete, UNFI intends to shed a majority of Supervalu’s retail assets, leaving behind its distribution capabilities.

The Wall Street Journal reported that UNFI has been struggling to keep up with demand from Whole Foods after its merger with Amazon. So, this could be a reason for the deal.

Two other possible explanations are:

1) UNFI may have felt the need to diversify its revenue stream, as Whole Foods is its largest account and represents approximately 1/3rd of its revenues.

2) UNFI may have seen this as an essential long-term strategic move to prepare for the possibility that Amazon eventually decides to do its own distribution and no longer needs UNFI.

As more developments about this deal come to light, we will keep you posted.

Have a great day!

Max Goldberg, Founder

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