L.A. co-op, AG seek to merge companies

Seattle-based Associated Grocers will merge with Unified Western Grocers in a deal announced Monday.

Los Angeles-based Unified Western Grocers said in a statement it will buy "certain assets and assume certain liabilities" of Associated Grocers but gave few details.

The transaction is expected to close late this summer, pending approval by both companies' board of directors and shareholders.

Both companies are wholesale distributors that are structured as co-ops.

John Runyan, president and CEO of Associated Grocers, said in a prepared statement that combining them "will create a very competitive grocery industry force for independents in the Western United States."

Associated Grocers saw revenues of about $1 billion in 2005, according to the Puget Sound Business Journal. Brown and Cole Stores, a regional chain that owned more than 20 percent of Associated Grocers, filed for Chapter 11 protection last year; Larry's Markets, another customer, went out of business last summer.

Unified Western, which describes itself as the largest wholesale grocery distributor in the Western United States, posted sales of $3 billion in 2006.

Associated Grocers has been considering selling the company or setting up an alliance with another wholesaler since the summer of 2005 as part of a fresh look at its strategy.

Earlier this year, the 73-year-old company sold its 55-acre South Seattle headquarters and food-distribution hub to Sabey Corp. for $91 million.

Kirsten Orsini-Meinhard: 206-464-2391 or kmeinhard@seattletimes.com