White Rose, the large voluntary wholesale grocer which supplies many smaller urban grocery stores in the five boroughs of New York (Met Food, Associated Food Stores, Pioneer, etc.) and also some larger ones (Fairway, Kings/Balducci and Thriftway/Shop n Bag) is up for sale according to parent company, Associated Wholesalers, Inc. (AWI).
On June 13, AWI confirmed that selling White Rose, the Carteret, NJ-based distributor it acquired in 2006 which has annual sales of slightly more than $1 billion, is a key part of steps it is taking to set a strategic direction that will provide the cooperative with the opportunity to refocus on AWI’s core legacy business – a business that was built on the entrepreneurial spirit of AWI’s members.
AWI also announced that president and chief executive officer J. Christopher Michael has retired from the company after 41 years of service. He had served as chief executive of the Robesonia, PA co-op since 1980. Veteran wholesale executive Matthew Saunders has been named president and CEO of AWI, effective immediately.
Michael will remain with AWI as chairman emeritus to help oversee a smooth leadership transition. Saunders joined AWI as executive vice president and chief operating officer in 2012. He previously served in leadership roles at Merchants Distributors Inc. and Supervalu.
Joyce Fasula and Mike Rothwell, chair and vice chair of the AWI board, respectively, said, “On behalf of the entire AWI board, we want to thank Chris for his extraordinary contributions to AWI and wish him well on his retirement. In his 34 years as CEO, Chris has played an important role in building AWI into one of the nation’s leading wholesale cooperatives. We are also pleased to have an executive as talented as Matt ready to assume the CEO role. Matt is a proven leader with extensive experience in our industry, and we are confident that he is the right person to steer AWI into its next phase of growth and development.”
The AWI board has formed a special committee to pursue a sale of the White Rose business and has retained Lazard Middle Market as its investment banker to assist in this process.
Regarding the White Rose decision, Fasula and Rothwell said, “After extensive analysis, our board has determined that this is the right time to identify a suitable buyer for White Rose. Through this sale process, we intend to position White Rose for a fresh beginning under a new owner. A sale of White Rose will give AWI the opportunity to get back to our co-op roots, with a sharp focus on growing the core business.”
One New Jersey-based retail executive who is not currently a White Rose customer, but once was, said, “There would seemingly have to be a guarantee that White Rose’s larger customers – Kings/Balducci’s, Fairway and RMG – and the groups that it controls such as Met Foods and Associated would have to be part of any transaction. From a logistics perspective alone, all the major wholesalers in the Northeast – Bozzuto’s, Burris, C&S and Supervalu – can easily service White Rose’s customers based from their current distribution centers and can supply them less expensively and more efficiently. So, securing White Rose’s customers is vital to selling the business.”