GROCERY CHAIN MERGERS
By Adnews Staff
Loblaw Co. Ltd. of Toronto says its $1.7 billion bid for Quebec-based Provigo Inc. has been accepted by 98% of the shareholders. The deal will give Loblaw a dominant position in the Ontario and Quebec markets. The supermarket chain has agreed to keep Provigo's name, head office, board of directors and existing jobs. It will also continue purchasing practices that favor Quebec suppliers. Loblaw operates 360 company-owned and 547 franchise-owned grocery stores across Canada. The outlets operate under the banners: Loblaws, Zehrs, Fortino's, Super Valu, No Frills, Valu-Mart, National Grocers, Atlantic Wholesalers, Kelly Douglas & Co. and Westfair Foods. Provigo operates 239 company-owned and 109 franchise-owned supermarkets in Ontario and Quebec, under the names: Provigo, L'Econome, Presto, Maxi and Maxi & Co. In an agreement with Metro Richelieu, Loblaw will give Metro the first crack at purchasing the Loeb outlets in Ontario, as well as other assets.
In a separate deal, Loblaw has also acquired the Oshawa Group's IGA stores in Atlantic Canada for $75 million. This deal stems from the merger of the Oshawa Group and Sobeys Canada, which dominates Atlantic Canada. The two companies thought the deal might be scrapped by the federal Competition Bureau unless Oshawa sold its Atlantic IGA stores to another company.