Associated Wholesale Grocers, one of the largest grocery cooperatives in the United States and one of the area’s largest companies, has reached an agreement to combine distribution businesses with Affiliated Foods Midwest cooperative.
Affiliated Foods Midwest, a Nebraska cooperative with operations in Elwood, Kan., supplies 800 stores in 15 states. AWG is the larger concern in this combination by serving 3,000 stores in 30 states.
Terms of the transaction, announced Thursday, were not disclosed.
Boards for both companies approved the combination unanimously. Closing, which is expected to occur by the end of the year, awaits approval by shareholders from Affiliated Foods Midwest and other conditions.
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The two companies predicted the merger would help its retail members realize lower cost of goods.
“Combining our distribution center networks and support infrastructure will allow us to more effectively serve our growing numbers of independent member-retailers,” said David Smith, president and chief executive of AWG in Kansas City, Kan., in a written statement.