After last week's closings of the online grocers Webvan and Homeruns.com, Peapod stood alone as the only multi-market player in a once crowded field. Yesterday MSNBC posted a long look back at the business of Internet-aided grocery delivery, wondering whether 10-year-old Peapod could stay independent. The question was answered by midmorning: Dutch giant Ahold will buy the 42 percent of Peapod it doesn't already own, for about $35 million.
Peapod operates in Chicago, Boston, Washington and a few other locations east of the Mississippi, so local angles abounded. The Boston Globe reported that Peapod serves "tens of thousands" of customers in the Boston area, out of 120,000 nationwide. Most outlets noted that Peapod claims to be running an operating profit in Chicago. According to the Washington Post, Peapod president Marc van Gelder says that Long Island and Connecticut are also on the black side of the ledger.
InternetNews's Beth Cox mentioned that Ahold obtained an antitrust clearance when it bought 51 percent of Peapod in April 2000, and that it believes no further clearances are needed now.
Peapod's hometown paper, the Chicago Sun-Times, spent the most ink on the deal. Many outlets mentioned that once the transaction closes in third quarter, Peapod will be delisted from the Nasdaq. Only the Sun-Times' Sandra Guy pointed out that the deal coincides with the company's need to keep its balance sheet from dropping below $4 million in net tangible assets - which would have triggered delisting by Nasdaq. With delivery services, timing is everything.
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Ahold Agrees to Buy Remaining Shares Of Online Grocer Peapod for $35 Million
The Wall Street Journal
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