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Pamida - Shopko to merge

February 1, 2012
By John Speer - Editor , Toledo Chronicle, Tama News-Herald

Toledo's 37-year old Pamida Store is expected to become a Shopko Hometown Store as a result of a merger announcement made earlier this month.

The Toledo location actually got its start in 1968 originally built as a Gibson Store built in 1968 on South County Road (U.S. Highway 63) in Toledo.

The store here has undergone expansions and the addition of a full service pharmacy over the years.

Article Photos

RIGHT- The familiar Pamida store front on South County Road (U.S. 63) in Toledo.

Chronicle/John Speer

In December, 2011, Doyle's Family Pharmacy operation in Toledo was merged with and joined the Pamida Pharmacy.

Pamida operates a total of 193 stores in 17 states and Shopko has 149 stores.

According to the merger announcement the move will create one of the largest U.S. retailers focused on serving smaller and rural communities.

"This is an exciting move for Pamida, and the Shopko Hometown format will offer our customers an even better retail experience and a new and differentiated product offering that is not currently available in the smaller communities we serve," said Pamida President and CEO John Harlow. "Pamida's great associates, store locations, focus on personalized service, and commitment to giving back in our local communities are all ideal complements to Shopko."

Harlow will serve on the leadership team and help direct the integration process, according to the news

"Merging Pamida and Shopko is a great move for our businesses and our customers given our complementary strengths, store networks and consumercentric retail models," said Shopko President Chairman and CEO W. Paul Jones. "The Shopko Hometown store format, featuring our unique merchandising strategy and improved store design, is an ideal fit for the smaller communities that Pamida serves with its exceptional service and community-minded approach.

"We intend to be the leader in this category by combining the best of Shopko and Pamida in our aggressive new store growth plans," Jones said.

News Release Details

The announcement provided this outline of what customers can expect: "There will be no change to Shopko's stores, and approximately $80 million will be invested over the next 12 months in the conversion of most of Pamida's locations to the Shopko Hometown store concept and brand.

The Shopko Hometown retail format, developed over the past three years to augment Shopko's larger store model, offers a differentiated and financially successful merchandising strategy. Shopko Hometown combines pharmacy services with a broad and dynamic offering of strong national brands and high-value private label brands of apparel, toys, consumer electronics, seasonal items, and lawn and garden products all in attractive, well laid out, easy-to-shop store formats that range from 15,000 to 35,000 square feet.

Over the past two years, Shopko has purchased seven stores from Pamida and successfully transitioned them to the Shopko Hometown format.

These locations have delivered an improved customer experience and have seen a significant increase in store traffic, sales and profitability, affirming the potential of the merger.

Once Pamida's chain-wide conversions are complete, the company plans to accelerate the addition of new Shopko Hometown stores in the second half of 2012 and into 2013. Both companies are owned by affiliates of Sun Capital Partners, Inc., a leading private investment firm focused on leverage buyouts, equity, debt, and other investments in market?leading companies.



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