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Retail operators Winn-Dixie Stores Inc., based in Jacksonville, FL, and BI-LO, based in Greenville, SC, announced Dec. 20 that they will merge operations to create an organization of approximately 690 grocery stores and 63,000 employees in eight states throughout the southeastern United States.

Under the terms of the definitive agreement, BI-LO will acquire all of the outstanding shares of Winn-Dixie stock in the merger. The deal is valued at about $560 million, and once completed will triple the number of stores BI-LO operates in the Southeast to 690, putting it in a position to compete with retail giants Walmart and Food Lion in the region.

“We are very excited about the merger of BI-LO and Winn-Dixie,” Randall Onstead, chairman of BI-LO, said in a press release. “With no overlap in our markets, the combined company will have a perfect geographic fit that will create a stronger platform from which to provide our customers great products at a great value, while continuing to offer exceptional service. BI-LO and Winn-Dixie are both strong regional brands with similar heritages, compelling customer connections and outstanding employees. Both have been an important part of the communities and families they serve, and we look forward to building upon these two iconic brands and serving loyal customers for years to come.”

“This transaction with BI-LO provides Winn-Dixie shareholders with a significant cash premium for their shares. We believe this transaction is in the best interests of our shareholders,” Peter Lynch, chairman, chief executive officer and president of Winn-Dixie, added in the press release. “By combining BI-LO and Winn-Dixie, we anticipate building a company that is stronger than our individual businesses and creating opportunities for continued advancement through the cross-pollination of our people and the sharing of ideas across our organizations, all to the benefit of our guests, suppliers, team members and the neighborhoods that Winn-Dixie serves.”

The transaction is expected to close in the next 60 to 120 days, subject to the approval of Winn-Dixie shareholders and other customary closing conditions. Until the merger is complete, both BI-LO and Winn-Dixie will continue to operate as separate companies.

Following completion of the merger, it is anticipated that stores will continue to operate under both the BI-LO and Winn-Dixie banners, and the combined company will maintain a presence in both Greenville and Jacksonville.