Grocery Outlet Holding Corp. said recently that it has agreed to acquire United Grocery Outlet (UGO), a discount grocery retailer operating throughout the Southeastern United States. The California-based retailer is set to purchase the business in a $62 million transaction from affiliates of Gen Cap America, Inc. and current and former UGO management, according to Grocery Outlet.
With 40 stores and a distribution center, the acquisition of UGO will expand Grocery Outlet's presence into Tennessee, North Carolina, Georgia, Alabama, Kentucky, and Virginia.
"United Grocery Outlet is a natural fit given our similar opportunistic buying strategies, customer value propositions, and shared mission of serving our communities,” said RJ Sheedy, president and CEO of Grocery Outlet, in a statement. “This acquisition provides Grocery Outlet with scale in a new region as well as a platform for future expansion in the Southeast. We are excited to welcome the United Grocery Outlet team into the GO [Grocery Outlet] family, and we look forward to working together on the many growth opportunities ahead."
Founded 50 years ago, United Grocery Outlet offers customers savings within a ‘treasure hunt’ shopping environment.
"We are thrilled to become part of Grocery Outlet and to have found a partner who shares our mission and business strategy. Together, we look forward to growing the positive impact on our community," said Lisa Bryson, CEO of United Grocery Outlet, in a statement.
The acquisition is expected to close early in the second quarter, subject to customary closing conditions.
In addition to the newly acquired stores, Grocery Outlet plans to open 15 to 20 stores in existing markets in 2024, for a total of 55 to 60 net new stores this year.