New York News
New York City grocery chain Fairway to go public
NEW YORK (WABC) -- Fairway, the iconic New York grocery store chain whose initial public offering was disrupted by Superstorm Sandy, said Thursday it is ready to go public in hopes of raising up to $164 million.
Fairway Group Holdings Corp. said in a regulatory filing Thursday that it expects its stock to price in the range of $10 to $12 per share. The company is selling 13.4 million shares and stockholders are selling another 286,436.
Under the slogan "like no other market," Fairway operates 12 locations in the greater New York City area and expects to open another one this summer in Manhattan's Chelsea neighborhood and one in Nanuet, N.Y, in the fall. The company got its start in the 1930s as a small neighborhood market. In 2007, Sterling Investment Partners bought an 80 percent stake in the company, spurring fast growth in the ensuing years. The investment firm will continue to control the company after the IPO.
Fairway specializes in offering a broad selection of groceries for city and suburban dwellers. It mixes the natural and organic goods that Whole Foods shoppers expect with gourmet products, as well as conventional grocery items such as laundry detergent and toilet paper. Because of this, Fairway says it can reach a broader range of customers than specialty markets or discount chains.
The company had revenue of $554.9 million in the fiscal year that ended April 1, 2012, up 14 percent from $485.7 million a year earlier. It booked a loss of $36.7 million last year, and a loss of $39 million a year earlier, due to the cost of opening new stores.
It's common for companies to be unprofitable before going public, because they are spending money on growing their business.
Fairway said it plans to use the proceeds from the IPO to open new stores and for other general business purposes.
Superstorm Sandy flooded and damaged Fairway's location in Red Hook, Brooklyn, last fall and the store was closed from late October to late February. The company had originally filed to go public in September.
Fairway plans to list its stock on the Nasdaq under the symbol "FWM."
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