Parent of Boys Markets, Claremont Firm to Merge

Breco Holding Co., the parent of Los Angeles-based Boys Markets, said Tuesday that it will merge with Yucaipa Holding Co. of Claremont to form a 100-store supermarket chain with operations in California, Kansas and Missouri. Terms of the deal were not disclosed by the companies, which are privately held.

Yucaipa operates 24 stores, including the Food 4 Less warehouse markets in the San Bernardino and Moreno Valley areas. It also operates Falley’s Inc. in Kansas and Missouri.

Breco operates 70 stores, including 24 in the Boys Markets chain, which was founded in 1924. It also recently agreed to buy Bell Markets, an independent San Francisco chain of six stores.

“This is truly a merger of equals,” said Breco Senior Vice President George Golleher, who said the purpose of the merger was to form a “new, larger company with a stronger base to grow.” The combined company would have revenue of more than $1 billion a year, he said.

Golleher said both companies are “very profitable.”

Boys, which operates in Southern California only, has been lauded for putting stores in primarily minority communities that have been abandoned by larger supermarket chains. However, it has also sometimes been accused of charging higher prices than other chains.

In addition to Boys, Breco operates supermarkets under the names Market Basket, Viva Mart, Cala and QFI in the Los Angeles and San Francisco Bay areas.

Golleher said the two companies have no prior business relationships, but that officials of both companies have known each other for many years, and share similar business philosophies. The firms’ top officials worked together in the late 1970s and early 1980s as officers of Stater Bros., a small Colton, Calif.-based supermarket chain, he said.

The merger announcement left unclear whether the Brener family of Mexico will have a continued stake in the new company. Boys was purchased a little more than a year ago by American Breco Corp., a Century City firm controlled by the wealthy Breners.

American Breco paid $131 million for Boys. Golleher would only say Tuesday that current Breco Chairman Alfredo Brener is retiring and won’t hold the title in the new--yet unnamed--combined company. Brener couldn’t be reached immediately for comment.

Yucaipa Chairman Ronald Burkle will be chairman of the merged company, Golleher said. Peter Sodini, current Breco and Boys president and chief executive, will become president and chief executive of the combined companies.