The parent company of grocery chain Sobeys Inc. says it has reached a deal to acquire food retailer Farm Boy in a bid to expand its reach in Ontario.
The first Farm Boy location opened in Cornwall in 1981.
"I promise, Shannon, we won't screw up", Medline said in a conference call with industry analysts. "They have a proven business model with an established brand ... and a significant runway for growth". Greenhill & Co Canada Ltd, Scotiabank and KPMG LLP were the financial advisers to Empire Co Ltd.
The chain now has 26 locations across southeastern Ontario.
The acquisition comes as competition in the grocery space continues to heighten, with Amazon acquiring Whole Foods Market a year ago.
Ottawa-based Farm Boy, which specializes in "farm-to-table" wholesale, will be acquired from Berkshire Partners, following which it will be set up as a separate company within Empire's structure.
Bellemare said nothing will change in the today's call.
The deal means Farm Boy will ramp up its expansion in the Toronto area and southwestern Ontario. Empire will provide help with logistics and real estate, Medline said in the call.
Medline said Farm Boy has a winning formula, calling it a "jewel of an asset".
Farm Boy, the Ottawa-based grocery chain, is being sold to the owner of Sobey's.
"This was it, and this was the timing", he said. "We don't want to ruin the magic of Farm Boy". "Our old world and new world competitors are not standing still".