Empire Co. Ltd., Canada, announced plans to acquire Farm Boy, a Canada-based food retailer with 26 locations in Ontario, Canada.
Farm Boy's fresh format is an ideal fit with Empire's Sobeys and FreshCo banners in Ontario.
Jean-Louis Bellemare, Farm Boy's founder and co-CEO, and Jeff York, who has been co-CEO of Farm Boy since 2009, will continue in their roles, managing the business separately from Empire's broader operations. Although managed separately, Farm Boy will benefit from Empire's infrastructure and capabilities in real estate, sourcing and logistics.
Rollout of the Farm Boy concept in the Greater Toronto Area (GTA) and continuing the existing expansion plans in southwestern Ontario will be early priorities, through a combination of new site builds and conversions of some existing Sobeys locations. As well, Farm Boy will add private label products to Sobeys' new Ocado-based e-commerce business.
"Farm Boy is a superb strategic and financial acquisition. It strengthens our reach in the key Ontario and GTA markets, it will be a growth vehicle in urban and suburban markets and its very strong private label program will bolster our Ocado-driven e-commerce business," says Michael Medline, president and CEO of Empire. "Farm Boy has a best-in-class brand with stellar customer loyalty. Its fresh, ready-to-eat and private label offerings are particularly appealing to urban and suburban consumers – it truly is 'all about the food' at Farm Boy. We believe we will be able to build on their historical industry leading same-store sales growth of 5.3% and 5-year EBITDA CAGR of 21% to double the size of the business in the next five years."
"This is a great addition to our portfolio at a time when we are moving from defense to offence. We believe that with the leadership of our new colleagues, current CEOs Jean-Louis Bellemare and Jeff York, we can turbo-charge Farm Boy's growth. We intend to enable the leadership team of Farm Boy to do what they do best – grow a highly successful retail format at double digit rates," adds Medline. "As we continue to make excellent progress with Project Sunrise and emerge from the heavy-lifting phase, we are excited to advance our growth agenda with this powerful and proven concept."
"As you prepare for the next phase of growth, you don't just team up with anyone. Empire understands what it will take, shares our vision for the brand and in president and CEO Michael Medline and CFO Mike Vels, we have access to executive leadership with deep experience in making acquisitions like this successful. We had many choices, but our trust and confidence in Empire and its dedication to our brand and its growth made this the perfect partnership," says Bellemare:
"What an extraordinary opportunity for Farm Boy. Together with Empire, an iconic Canadian brand with a national grocery presence, Farm Boy will significantly accelerate its growth agenda. We will strengthen the already strong Farm Boy brand, starting with urban and suburban markets in Ontario and eventually rolling out to other areas of Canada. We are particularly excited by the eventual reach of the Ocado e-commerce platform and can't wait to showcase our high-quality, local products to many more Canadians," says York.