Caito and BRT will become part of SpartanNash's food distribution segment following the close of the transaction. Caito's senior leadership team, including Caito President Robert Kirch and Blue Ribbon Transport President David Frizzell, will join SpartanNash upon completion of the transaction. Mr. Kirch will report to Dave Staples, SpartanNash President and Chief Operating Officer; Mr. Frizzell will report to Derek Jones, SpartanNash Executive Vice President, President of Wholesale and Distribution Operations. Both will continue in their roles and oversee the acquired operations which will remain based in Indianapolis.Kirch noted, "With our long history and family tradition of processing and distributing fresh, convenient, healthy foods, we are excited and proud to join an organization that shares our passion and commitment to serve customers with the freshest foods. We are looking forward to joining the SpartanNash family to expand and enhance our combined ability to deliver high quality fresh products efficiently to a greater number of customers across the country." Transaction Details Under the terms of the transaction, SpartanNash will purchase certain assets of Caito Foods Service and Blue Ribbon Transport for approximately $217.5 million in cash, in addition to reimbursing Caito for certain transaction costs and providing two earn-out opportunities that have the potential to pay the sellers an additional $12.4 million collectively if the business achieves certain performance targets. The transaction is expected to be accretive to full year 2017 earnings. The purchase price will be funded with proceeds from SpartanNash's asset-based lending facility. SpartanNash expects to close the acquisition by early January 2017, subject to regulatory approval and customary closing conditions. Advisors Deutsche Bank acted as financial advisor and Morgan Lewis acted as legal counsel to SpartanNash. Forward-Looking Statements This communication contains forward-looking statements. These statements are based on estimates and assumptions and are subject to risks and uncertainties. Forward-looking statements include the information concerning our possible or assumed future results of operations. Forward-looking statements also include those preceded or followed by the words "expects," "believes," "estimates," "looks forward to" or similar expressions. The following important factors, along with those discussed in our filings with the Securities and Exchange Commission (the "SEC"), could affect future results and could cause those results to differ materially from those expressed in the forward-looking statements: adverse conditions in the U.S. economy; the effects of competition in the markets in which we operate; material changes in the food industry; disruption of key suppliers' provisioning of products or services; changes in the regulatory environment in which we operate, adverse conditions in the credit markets affecting the cost, including interest rates, and/or availability of further financing; material adverse changes in labor matters; changes in accounting assumptions that regulatory agencies, including the SEC, may require or that result from changes in the accounting rules or their application, which could result in an impact on earnings; and the inability to implement our business strategies. The transaction described above is subject to numerous closing conditions, many of which are not within the control of SpartanNash. There is no guarantee that the transaction will close, and if it does close, there is no guarantee that the expected benefits from the transaction will materialize. This section is intended to provide meaningful cautionary statements for purposes of the safe harbor provision of the Private Securities Litigation Reform Act of 1995. This should not be construed as a complete list of all of the facts and conditions that could adversely affect the Company's results of operations, financial condition, or liquidity. SpartanNash undertakes no obligation to update or revise its forward-looking statements to reflect developments that occur or information obtained after the date of this communication.
About SpartanNashSpartanNash (Nasdaq: SPTN) is a Fortune 400 company whose core businesses include distributing grocery products to independent grocery retailers, national accounts, its corporate owned retail stores, and U.S. military commissaries. SpartanNash serves customer locations in 47 states and the District of Columbia, Europe, Cuba, Puerto Rico, Bahrain and Egypt. SpartanNash currently operates 159 supermarkets, primarily under the banners of Family Fare Supermarkets, Family Fresh Market, D&W Fresh Market and SunMart. Through its MDV military division, SpartanNash is the leading distributor of grocery products to military commissaries in the United States. About Caito Foods Service Caito Foods Service is a leading supplier of fresh fruits and vegetables, fresh-prepared foods, and fresh floral products to grocery retailers and foodservice distributors in 22 states from its distribution centers in Indiana, Ohio and Florida. Through its Blue Ribbon Transport operations, Caito offers internal distribution and logistics services for its customers and for other companies throughout the United States. Caito Foods was founded in 1965 by Philip J. Caito, IV, and his brother, Joseph A. Caito. Together, the brothers developed a dedicated team of managers and leaders and built a company culture centered on family values, success for their associates, and world-class service for their customers.