The transaction will cost £152m for the discount chain
With a £152m swoop on Northern Grocer Heron Food Group, discount retailer B&M Bargains is the latest company to take part in the frenzied consolidation of the convenience food market.
The acquisition meant that B&M could offer discount groceries from convenience shops and undercut the higher prices that supermarkets offered at its smaller stores.
"The convenience sector has been growing very well and they are now the source of supermarkets' growth while their mother-ship supermarkets have been struggling. But as a sector, the convenience market has not been well served on price," said Simon Aurora, boss of B&M.
B&M has grown, rapidly targeting increasingly cost-conscious shoppers around the country. The company proposes to increase its count of stores from 543 shops to 950 across the UK and grow from 79 shops in Germany.
Heron will cost £112.1m upfront for the discount chain, though the price tag is as high as £152m once Heron's debt is included as well as a further £12.8m payment that will depend on its earnings performance in two years' time.
Employing 3,800 people, Heron made sales of £274.4m last year, with pre-tax profits of £8.6m. Source: The Telegraph PWKD07082017