Aldi, the global discount supermarket chain, has agreed to acquire Winn-Dixie and Harveys Supermarket, two regional grocery brands in the Southeast US, from Southeastern Grocers, the parent company of the two brands.

The deal, which includes 400 stores in five states, will expand Aldi’s presence and growth in the region.

The acquisition is part of a larger divestiture of Southeastern Grocers’ US supermarket portfolio to various entities. Southeastern Grocers is a conventional supermarket company that operates in brick-and-mortar and online channels, serving customers in Alabama, Florida, Georgia, Louisiana and Mississippi.

Aldi plans to operate Winn-Dixie and Harveys Supermarket stores with the same level of quality and service, while evaluating which locations will convert to the Aldi format. Aldi has invested $2.5 billion in the Southeast US since the mid-1990s and has more than 2,400 stores nationwide. The company recently opened a regional headquarters and distribution center in Loxley, Alabama.

Jason Hart, CEO of Aldi, said: “The time was right to build on our growth momentum and help residents in the Southeast save on their grocery bills. The transaction supports our long-term growth strategy across the United States, including plans to add 120 new stores nationwide this year.”

Anthony Hucker, president and CEO of Southeastern Grocers, said: “This merger agreement is a testament to our successful transformational journey and the tireless work of our dedicated associates who serve our communities. Aldi shares our vision to provide exceptional quality, service and value – and this unique opportunity will evolve our business to benefit our customers, associates and neighbours throughout the Southeast.”

The transaction is expected to close in the first half of 2024, subject to regulatory approval and other customary closing conditions. Deutsche Bank served as financial advisor to Aldi, Baker & McKenzie as transaction counsel, and Kayne Law Group as real estate counsel.