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MEGAFOODS TO ACQUIRE 15 KROGER STORES LOCATED IN SAN ANTONIO

 MESA, Ariz., July 21 /PRNewswire/ -- Megafoods Stores Inc. (NASDAQ: MEGF) and The Kroger Co. (NYSE: KR) said today that the two companies have signed a letter of intent for Megafoods to acquire the assets of 15 stores located in the San Antonio area from Kroger. In addition, the two companies will enter into an agreement to supply inventory to the newly acquired stores.
 The acquisition is expected to close in mid-August pending consummation of due diligence, any required approvals and the execution of definitive agreements. The stores will be converted to the Megafoods "warehouse" format and re-open in October 1993.
 Dean Miller, chief executive officer of Megafoods, said, "The acquisition of the San Antonio Kroger stores is in line with our overall growth strategy and provides us immediate critical mass in this area of the Texas market. We are excited about the San Antonio market and the benefits of a supply arrangement with Kroger." To establish a strong presence in the market, Miller also said that Megafoods anticipates opening five additional stores in the San Antonio area by year-end 1994.
 With the opening of the San Antonio stores, Megafoods would operate 38 warehouse stores. An additional 12 stores are scheduled to open in the third and fourth quarters, for a total of 50 stores by year-end 1993.
 -0- 7/21/93
 /CONTACT: Dean G. Miller, CEO, 602-545-3249, or Sondra L. Mize, investor relations, 602-545-3235, both of Megafoods Stores/
 (MEGF KR)


CO: Megafoods Stores Inc.; The Kroger Co. ST: Arizona, Texas IN: REA SU: TNM

LM-LS -- LA025 -- 4082 07/21/93 15:23 EDT
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Publication:PR Newswire
Date:Jul 21, 1993
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