Wild Oats Markets to Buy 13 Stores From Competitors

Wild Oats Markets has agreed to buy 13 stores from competitors, which would make it the nation’s largest natural-foods supermarket company.

With the proposed acquisition, the company would have 105 stores, nudging 100-store Whole Foods Market Inc. of Austin, Texas, out of first place. The announcement was included in Wild Oats’ third-quarter earnings report.

Wild Oats has agreed to acquire the 13 stores in two transactions totaling $34 million in cash and stock. One of its proposed purchases, Sun Harvest Farms Inc., owns nine stores in Texas. The rest are from Wild Harvest in the Boston area.

Overall, Wild Oats has added 37 stores to the company this year. It also operates Alfalfa’s natural-foods supermarkets.

Roughly two-thirds of Wild Oats’ stores have been gained through mergers or buyouts, Chief Executive and co-founder Mike Gilliland said. “We’ve been doing this for years, so we think we have a system that works pretty well.”

Investment firm Adams, Harkness & Hill, based in Boston, agrees. “Wild Oats continues to enhance its growth rate through acquisitions and internal initiatives, strengthening its position in the natural foods sector,” an Adams, Harkness analyst said in a recent report. “Management has proven its ability to integrate a number of acquisitions while delivering solid operating results.”

Wild Oats has 23 other stores in the works, six of which are relocations of existing markets.

Profit for the third quarter, which ended Oct. 2, increased 12% to $4.4 million. Wild Oats’ profit for the nine-month period rose 33% to $15.3 million.

Sales were up 47% to $172.8 million in the third quarter and increased 37% for the nine-month period to $478.2 million.