Schultz Sav-O Stores, Inc. (Nasdaq: SAVO) yesterday announced that its affiliate, Schultz Acquisition Corp., has signed a definitive purchase agreement to acquire Brodbeck Enterprises, Inc., the Platteville, Wisconsin-based operator of Dick’s Supermarkets. Dick’s Supermarkets operates eight stores in Southwestern Wisconsin and Northwestern Illinois. The financial terms and conditions of the acquisition were separately announced by Schultz in its Form 8-K filing with the Securities & Exchange Commission.
Schultz Sav-O Stores recently announced several strategies for long-term growth and profitability including its intention to acquire multiple successful supermarket brands, to broaden its geographical territory and to significantly increase its retail segment. “This acquisition is directly in line with our key strategies and will allow us to aggressively pursue additional shareholder value,” said Elwood F. Winn, president and chief executive officer. “After the acquisition is complete, we will market supermarkets under both the Piggly Wiggly® and Dick’s Supermarkets brand names.
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“Dick’s Supermarkets is a perfect fit for expansion for Schultz Sav-O Stores. The company has an excellent reputation for quality and is a premier performer. Dick’s is number one in market share in each of its markets. We are impressed with its state-of-the-art style of supermarket management and customer focus.”
Dick’s had sales of over $100 million in 2000. The company operates seven stores in Wisconsin and one in Galena, Illinois. The Wisconsin stores are located in Platteville, Lancaster, Boscobel, Monroe, Darlington, Dodgeville and Prairie du Chien. Dick’s will operate as a wholly-owned subsidiary of an affiliate of Schultz Sav-O Stores.
“Dick’s was founded by Dick and Helen Brodbeck in 1950 and is currently headed by their son Robert Brodbeck, president and CEO. Bob, a 35-year company veteran, will become president of our Dick’s Supermarket brand,” said Winn. “We are extremely pleased to have Dick’s join the Schultz Sav-O family and to have Bob and the store management teams and members become part of our organization,” Winn said.
Winn indicated that Dick’s has received several coveted supermarket industry awards, most recently for its use of e-business technology in merchandising. “Dick’s was the first supermarket in the nation to offer electronic Internet coupons and is a recognized leader in employing e-marketing and technology,” Winn said. “Overall, Dick’s has a very similar merchandising style to our Piggly Wiggly brand, with strong promotional programs, targeted marketing, advertising and a savings club loyalty card program,” Winn said.
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By GlobalDataIn addition to the eight stores, Dick’s operates a bakery and delicatessen facility in Platteville. In total, Dick’s has approximately 1,000 employees. Dick’s bakery and deli facility in Platteville will continue to supply Dick’s Supermarkets with its trademark fresh signature selections. Schultz Sav-O Stores will be the grocery wholesaler for Dick’s Supermarkets.
“We are very pleased to become part of the Schultz Sav-O organization,” said Robert Brodbeck. “The Schultz operation is very progressive, much like Dick’s, so we feel that our operations will fit well together. Being part of the Schultz Sav-O operation will allow us to take advantage of superior buying power, provide access to capital to perpetuate and grow the brand and make us a much tougher competitor in our markets.”
“We strongly believe in our ability to leverage these two strong regional supermarket brands, Dick’s and Piggly Wiggly, combining the strength of each while maintaining their individual market uniqueness,” said Michael R. Houser, vice chairman, executive vice president and chief marketing officer of Schultz Sav-O Stores. “We will bring to Dick’s Supermarkets all the powerful elements of our marketing, merchandising and procurement programs, enabling Dick’s to continue to excel with its positive community interaction and customer focus. Our concentrated efforts will also provide Dick’s with a more expansive store brand program, additional customer affinity enhancements and a host of national brand promotional and customized event initiatives.”
Schultz Sav-O Stores, Inc. is a supermarket retailer and grocery wholesaler through corporate-owned retail and franchised supermarkets. The franchised and corporate-owned retail supermarkets currently operate under the Piggly Wiggly brand. Schultz Sav-O Stores currently has 71 franchised supermarkets, 19 corporate-owned stores and two distribution centers. Stores are located throughout Wisconsin and Northern Illinois. Sales for Schultz in 2000 were over $500 million.
For more information, please visit Schultz Sav-O’s Web site at www.shopthepig.com.
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Certain matters discussed in this press release are “forward-looking statements” intended to qualify for the safe harbors from liability established by the Private Securities Litigation Reform Act of 1995. These forward-looking statements can generally be identified as such because the context of the statement will include words such as the Company “believes,” “anticipates,” “expects” or words of similar import. Similarly, statements that describe the Company’s future plans, objectives, strategies or goals are also forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties including, but not limited, to the following: (1) presence of intense competitive market activity in the Company’s market areas; (2) ability to identify and develop new market locations for expansion purposes; (3) continuing ability to obtain reasonable vendor marketing funds for promotional purposes; (4) ongoing advancing information technology requirements; (5) ongoing absence of food price inflation; (6) the Company’s ability to continue to recruit, train and retain quality franchise and corporate retail store operators; (7) the potential recognition of repositioning charges resulting from potential closures, conversions and consolidations of retail stores due principally to the competitive nature of the industry and to the quality of the Company’s retail store operators; and (8) the Company’s ability to integrate and assimilate the acquisition of Brodbeck Enterprises, Inc., and to achieve, on a timely basis, the Company’s anticipated benefits and synergies thereof. Shareholders, potential investors and other readers are urged to consider these factors carefully in evaluating the forward-looking statements and are cautioned not to place undue reliance on such forward-looking statements. The forward-looking statements made herein are only made as of the date of this release and the Company undertakes no obligation to publicly update such forward-looking statements to reflect subsequent events or circumstances.
