Apollo Global Management LLC (NYSE: APO) agreed to buy grocer The Fresh Market Inc. (Nasdaq: TFM) for about $1.4 billion in cash in the buyout firm’s third announced acquisition of more than $1 billion since the start of February.
Shareholders will receive $28.50 a share in a tender offer, the companies said in a statement Monday. The price is 24 percent above Fresh Market’s closing level on Friday. The Fresh Market operates about 170 grocery store chains across 27 states.
Fresh Market’s board conducted an “open and thorough review” of strategic alternatives before agreeing to the sale, according to the statement. Still, the Greensboro, North Carolina-based company can solicit better offers for 21 days after signing a definitive deal, the companies said.
Fresh Market is not the only grocery store chain that has received buyer interest lately. In 2015, Kroger Co. (NYSE: KR) bought Roundy’s Inc. (NYSE: RNDY) and Haggen added 146 stores on the west coast. For more on grocery stores, see Grocers Grow.
Ray Berry, who founded the company in 1982, and Brett Berry won’t tender their shares and will roll over the “vast majority” of their stakes in the transaction with Apollo, according to the statement. They collectively own about 9.8 percent of the stock.
Apollo agreed Feb. 8 to buy University of Phoenix owner Apollo Education Group Inc. for $1.1 billion, and on Feb. 16 it it said it would acquire home-security monitoring company ADT Corp. for about $6.9 billion.
JPMorgan Chase & Co. is advising Fresh Market, and Cravath, Swaine & Moore LLP and Richards, Layton & Finger P.A. are its legal advisers. Barclays, RBC Capital Markets LLC, Jefferies and Macquarie Capital are Apollo’s financial advisers. Morgan, Lewis & Bockius LLP and Morris, Nichols, Arsht & Tunnell LLP are legal advisers to Apollo and Paul, Weiss, Rifkind, Wharton & Garrison LLP is acting as legal adviser to Apollo as it relates to the debt financing.