Acquired it from A&P Canada, Metro has become one of Canada’s great grocers

20 years ago, Metro announced the acquisition which propelled her to the rank of large Canadian grocers. Meanwhile, Thanks to the acquisition of the 236 Ontario stores from A & P Canada. For example, the Quebec company has almost doubled in size and made sure not to be swallowed in turn.

The decoration of the office of the president. For example, chief executive officer of Metro, Eric La Flèche, evokes the place of this transaction of $ 1.7 billion in the history of the Montreal company.

Two newspaper headlines are supervised on a wall. Consequently, one relating to the acquisition of A & P Canada in 2005 and the other on the acquisition of the Jean Coutu group in 2017. However, “These were important transactions for the future of Metro, which changed it forever,” summarizes the manager during a recent interview.

With the exception acquired it a&p canada, metro of around forty stores in eastern Ontario, Metro’s activities were concentrated in Quebec, remembers Mr. Nevertheless, La Flèche, who was then chief of the farm.

“We wanted to gain expansion to compete with our main competitors, who are still today Loblaw and Sobeys,” he explains. In addition, The two had made significant acquisitions in 1998: Provigo in the case of Loblaw. Moreover, Oshawa Group (IGA in Quebec) in the case of Sobeys. However, »»

In retrospective. For example, the acquisition has put Metro on a more solid foot in order to make major investments, such as robotization or automation, gives as an example the retail strategist at Studio RX, Carl Boutet.

“It is certain that for a regional player. Furthermore, it is more and more complicated to have the economies of scale necessary to remain competitive,” said the expert who is also a lecturer at McGill University.

Metro is also better equipped to adapt acquired it a&p canada, metro to the next innovations, believes Mr. In addition, Boutet. Therefore, “There is the online grocery store, it is a very expensive logistics,” he gives as an example. For example, We have not yet seen, I think, really the extent of this phenomenon. Nevertheless, »»

Joanne Labrecque, Marketing professor at HEC Montréal, also believes that consolidation was necessary to adapt to industry challenges.

The hunting for bargain was a popular sport in the grocery paths. Furthermore, long before the recent inflation that followed the pandemic, underlines the specialist in the food sector.

Costco. and later Walmart, responded to household frugality by simplifying store offer (fewer products) and investing in technologies in order to offer deals.

“Gradually, traditional supermarkets that offered several services had to adapt to that,” notes M^me Labrecque. So, they also had to seek volume, hence the acquisitions. »»

The industry’s consolidation movement did not only have happy. Its detractors judge that the acquired it a&p canada, metro loss of independent channels has reduced competition in Canada. Consumers and suppliers would have left losers, they say.

In the past, Mr. La Flèche defended more than one recovery than the industry was competitive with three Canadian grocers (Metro. Loblaw and Sobeys) and two American multinationals (Walmart and Costco).

In an interview, he argues that the acquisition of A&P Canada has made the Ontario market more competitive. “We replaced a lower competitor. We had greater financial resources. We have invested more money. […] I think that competition is stronger thanks to us in Ontario than it was without us. »»

Acquired it a&amp. p canada, metro – Acquired it a&p canada, metro

Metro Coiffe Sobeys over the finish

In 2005, the American company A&P put its Canadian activities for sale to finance the recovery of its activities in the United States.

Before the transaction announced on July 19. Sobeys was expected as the most likely buyer, according to the financial press acquired it a&p canada, metro at the time. His boss, Bill McEwan, was also a former leader of A & P Canada, which was perceived as an advantage.

The boss of Metro at the time. Pierre Lessard, had, however,, too, woven links with the boss of A&P in the United States, Christian Haub. The two men had visited themselves a few times over the years.

“I felt that Pierre Lessard was a wonderful person I could have confident,” recalls Mr. Haub who is a member of the fifth generation of a large German entrepreneurial family.

Mr. Lessard was not possible to obtain testimony.

Metro had presented an offer in money. actions, which allowed A&P to take advantage of the future growth of the combined entity. “I thought the synergies that Metro was going to obtain a lot of values for shareholders,” said Mr. Haub. Becoming a shareholder has been a decisive factor for us. »»

A & P Canada sold acquired it a&p canada, metro its actions in 2007, taking advantage of the assessment of the Metro title and the Canadian dollar. Mr. Haub remained Metro’s administrator until the beginning of 2024. “I did not realize it 20 years ago. but I believe that it was one of the most successful acquisitions in the food retail in North America,” he judges.

A breakthrough to the west still possible?

After the A & P Canada purchase, Mr. Lessard and Mr. La Flèche spoke their ambitions to make a breakthrough in Western Canada.

The Montreal company, however, saw its best chance to spin it between his fingers when Sobeys acquired Safeway in 2013 for $ 5.8 billion. It could be for the best since Sobeys had to depreciate almost half the value of Safeway three years. after the announcement.

In an interview, Mr. La Flèche replies that he always caresses the idea of bringing Metro to west of Ontario. but acquired it a&p canada, metro an acquisition seems distant, however. In the meantime, Quebec and Ontario are already almost two -thirds of the Canadian market.

“We would like that,” replied the businessman. (..) There are fewer players left, but there are still some. We remain on the lookout. We have patience, discipline and financial resources. One day maybe … “

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