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HOUSTON-An opportunity to expand into Hispanic communities throughout Texas was the driving force behind Grocers Supply Co. Inc.’s proposed acquisition of Minyard Food Stores Inc.’s Carnival Super Market brand. A local retail pro says the move makes good sense for locally based Grocers Supply and its subsidiary, Fiesta Mart Inc.

“Fiesta looks for a high-concentration Hispanic demographic for their grocery stores and Carnival is similar,” says Lyle Cowand, senior vice president in Houston for Dallas-based Weitzman Group. “In areas in which Fiesta isn’t a player, such as Dallas, Carnival is strong, which will give Fiesta greater market penetration. I see it as a pretty smart move.”

According to a press release about the transaction, Grocers Supply will acquire 23 Carnival supermarkets, five Minyard stores, five fuel centers and nine Sack ‘n Save warehouse stores from the Coppell, TX-based Minyard Food Stores. Telephone calls to Grocers Supply and Fiesta were not returned by deadline.

Grocers Supply plans to let 11 stores roll to the 50-store Fiesta Mart and flip most of the balance to other retailers in its supply chain, according to the release. The acquisition is expected to close by the end of this year.

Cowand tells GlobeSt.com that Fiesta is a well-known brand in Houston, but not so much in other areas of Texas. This is where the Carnival brand name can provide a distinct advantage for Fiesta, he points out, citing Dallas in particular. Fiesta has 15 stores in Dallas-Fort Worth.

Cowand says he’d be surprised if any stores changed names after the deal closes. “It makes no sense for Fiesta to change its name here in Houston. It’s a main institution here,” he says. By the same token, Carnival has recognition in the Dallas market. “Grocers Supply has a number of concepts they control and you don’t see name changes on any of those,” Cowand adds.

In the release, Minyard’s management says Grocers Supply’s decision is an affirmation of its strategic focus on the burgeoning Latino food market. Minyard will have 21 stores left after the sale. “This agreement will allow us to sharpen our focus and resources on the Minyard banner,” says Michael D. Byars, president and CEO of the 78-year-old company.

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