Kroger Company (NYSE:KR) announced on Friday the sale of its online wellness unit, as it narrows its focus to grocery operations.
The retailer confirmed it transferred Vitacost.com to iHerb as part of a portfolio review.
Strategic Exit
Kroger closed the Vitacost transaction on January 8 after months of evaluating non-core business lines.
The company stated that the divestment supports a broader effort to streamline operations and enhance customer experiences.
Kroger aims to allocate capital toward food retail, supply chain enhancements, and in-store investments.
Ron Sargent, Kroger’s chairman and CEO, said the move aligns with the company’s priorities.
“As we shared earlier this fiscal year, we are reviewing all non-core assets to determine their ongoing contribution and role within the company as we make progress on our key priorities: simplifying our organization, improving the customer experience, and focusing on Kroger’s core business,” Sargent said.
“The sale of Vitacost is an important step in that process,” he added.
Buyer Rationale
iHerb stated that the purchase strengthens its position in the digital health and nutrition retail sector.
Emun Zabihi, chief executive of iHerb, said Vitacost adds a trusted brand and loyal customer base.
“The acquisition of the Vitacost brand represents a strategic investment in a name long associated with quality, value, and trust among American health and wellness consumers,” Zabihi said.
“Vitacost’s strong brand equity and established customer base complement iHerb’s global platform and capabilities, enabling us to further strengthen our leadership in the online health and wellness market,” he added.
Customer Impact
Kroger and iHerb said both companies worked together to avoid service disruptions.
They said employees and shoppers should experience a smooth transition during the ownership change.
The companies did not disclose financial terms for the transaction.
Kroger said the deal will not alter its previously issued guidance for fiscal 2025.
KR Price Action: Kroger shares were down 0.35% at $59.58 at the time of publication on Friday, according to Benzinga Pro data.
Photo by PassingMoments via Shutterstock
Recent Comments