Shopko and Pamida merging

Six months after Princeton’s Pamida store became a Shopko the two retailers are merging into one company.

The combined company will have 350 stores in 22 states, company officials said Wednesday, Jan. 4.

The company also plans to expand its number of stores in 2012, officials said.

The merger of Shopko Stores and Pamida will create one of the largest U.S. retailers focused on serving smaller communities.

Shopko operates 149 stores in 13 states — including the Shopko Hometown store in Princeton.  Pamida operates 193 stores in 17 states — and until May operated a Pamida store in Princeton that was converted to a Shopko.

The combined company, which will be headquartered in Green Bay, will use the Shopko name and be led by Shopko president, chairman and CEO W. Paul Jones.  Pamida President and CEO John Harlow will serve on the leadership team and help direct the integration process.  There will be no change to Shopko’s stores, and approximately $80 million will be invested over the next 12 months in the conversion of most of Pamida’s locations to the Shopko Hometown store concept and brand.

“Merging Pamida and Shopko is a great move for our businesses and our customers given our complementary strengths, store networks and consumer-centric retail models,” Jones said in a prepared statement.  “The Shopko Hometown store format, featuring our unique merchandising strategy and improved store design, is an ideal fit for the smaller communities that Pamida serves with its exceptional service and community-minded approach. We intend to be the leader in this category by combining the best of Shopko and Pamida in our aggressive new store growth plans.”

Over the past two years, Shopko purchased seven stores from Pamida — including the Princeton store — and transitioned them to the Shopko Hometown format.  These locations have delivered an improved customer experience and have seen a significant increase in store traffic, sales and profitability, affirming the potential of the merger, company officials said.