Dutch retail giant Royal Ahold NV and Belgian rival Delhaize Group on Saturday said they had finalized their mega-merger after US regulatory authorities gave the union the green light.
“With our new management team we are very happy to continue to serve our clients and other shareholders,” said Ahold chief executive officer Dick Boer, who becomes chief executive officer of the merged firm, with Delhaize chief executive Frans Muller to serve as his deputy.
Delhaize chairman Mats Jansson said the two companies were coming together “to create an even stronger international retailer.”
The two groups see themselves as complementary in the US market, where Ahold owns stores located primarily in the northeast with its Stop&Shop and Giant, while Delhaize’s Food Lion and Hannaford are prevalent in the southeast. Between them the retailers have 6,750 stores in Europe and the US and employ 380,000 people.
Based in Zaandam just outside Amsterdam, Ahold announced in June last year it was merging with Delhaize to create one of the world’s largest retail companies with a turnover of more than $59 billion. The pair agreed earlier this month to sell 86 US-based stores to receive approval from the FTC.
It remains to be seen how the merger will impact private brand in the U.S., each retailer maintains a very traditional portfolio of private labels that include brands that are remarkably similar in positioning, pricing, quality and design. Optimization and consolidation would certainly lead to higher profitability and the opportunity to differentiated consumer relevant brands.