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TWO LIKE-MINDED MEMBER-OWNED COOPERATIVES TO COMBINE TO HELP RETAILERS COMPETE

Associated Wholesale Grocers, Inc. and Affiliated Foods Midwest Cooperative, Inc. announce their merger

PRESS RELEASE – July 28, 2016

TWO LIKE-MINDED MEMBER-OWNED COOPERATIVES TO COMBINE TO

HELP RETAILERS COMPETE

Associated Wholesale Grocers, Inc. (AWG) and Affiliated Foods Midwest Cooperative,

Inc. (AFM) announced today that they have reached an agreement to combine the two

cooperatives’ distribution businesses.

“This exciting endeavor is exactly what we need to allow our retailers to compete, grow

and be profitable,” said Martin Arter, the President and CEO of AFM. He further stated

“the synergies between our joint cooperatives will help our retailers thrive. Our members

benefit with a substantially lower cost of goods. Much credit is due to the vision of both

AWG’s and AFM’s Board of Directors to see the possibilities of what we could become.”

David Smith, the President and CEO of AWG indicated that the consolidation made

perfect sense. “We are excited about joining forces and combining the two cooperatives.

Expanding our collective distribution areas into several new adjoining states and adding

over 800 new member stores will make our unified cooperatives stronger together,

leveraging not only the additional scale and buying power but also employing and

implementing the best practices of each that have been developed over the 80 to 90 years

that our respective cooperatives have been in business. Combining our distribution center

networks and support infrastructure will allow us to more effectively serve our growing

numbers of independent member-retailers. This unified business will further strengthen

our relationship with the vendor community, reduce operating expenses and subsequent

cost of goods, and enhance our ability to support and serve our growing membership.”

AFM is a retailer-owned cooperative supplying members that operate over 800 stores in

15 states. AWG is a retailer-owned cooperative supplying members that operate over

3,000 stores in 30 states.

As proposed, the members of both cooperatives going forward would be members of a

larger AWG.

The alliance was unanimously approved by the board of directors of each company, and

while still subject to certain conditions, including the approval by AFM shareholders, it is

expected to close later this year.