Wal-Mart’s German foray tops list of 1998 deals

Wal-Mart Stores Inc. plans to launch its push into Europe from Germany, so it’s not surprising that the Bentonville-based retailer’s purchase of 74 Interspar hypermarket stores tops the list of deals made by Northwest Arkansas companies in 1998.

The purchase, valued at more than $1 billion by some German media accounts, was announced in December 1998. Wal-Mart, the world’s largest retailer, purchased 74 stores from Spar Handels AG.

Later this year Wal-Mart will begin using its name in Germany.

The deal was one of four announced by Wal-Mart in 1998.

But StaffMark Inc., the staffing company based in Fayetteville, was the region’s most active deal maker with 10 announcements of acquisitions during the year. However, prices were disclosed for nine of those deals.

Still, the 10th deal — the acquisition of Robert Walters Plc of London — was large enough to land StaffMark in fifth-place for the largest deals made by Northwest Arkansas companies.

The purchase of Robert Walters, valued at an estimated $172 million, added 18 offices in 10 countries to StaffMark’s holdings for a total of 6,000 clients, 31,500 employees and more than 240 offices around the world. The combined companies have annual estimated revenues of more than $1 billion.

Peter Vozzo, an analyst with Interstate/Johnson Lane in Charlotte, N.C., told the Business Journal when the deal was announced that the resulting larger StaffMark might be among the world’s 20 largest staffing agencies although it’s difficult to say for sure.

Vozzo said StaffMark was growing faster than the industry average — 20 percent for professional staffing divisions; 7 percent for commercial staffing. He expects the company’s commercial division to grow by 10 percent this year. Internal growth should be between 15 percent and 17 percent, Vozzo predicted last December.

The acquisition hasn’t helped StaffMark’s stock price yet. The stock was trading at about $26 a share when the purchase was announced in August. More recently, the stock’s been trading in the $18 range.

But the analysts who follow StaffMark remain optimistic. Seven recommend the stock as a “strong buy;” three rate it a “moderate buy.”

Tyson deal

In March, Tyson Foods Inc. announced it would sell its Cincinnati-based Pierre Foods division. Tyson had only owned the division, formerly a subsidiary of Hudson Foods Inc., for about two months.

WSMP Inc. of Claremont, N.C., paid $122 million in cash for Pierre Foods. WSMP, known as Western Steak Mom N Pops Inc. until 1988, touted the deal as making it the major force in the $2 billion prepared sandwich business in the country.

Pierre Foods makes and distributes precooked sandwiches and other food products to the food service industry. It does about $150 million in business annually. WSMP had worked with Pierre Foods for 10 years as a co-packer of WSMP’s sandwich lines.

Real estate deals

Several of the deals involved local real estate. Macerich Co. of Santa Monica, Calif., purchased the 775,000-SF Northwest Arkansas Mall from Tri-State Joint Venture in a deal valued at about $94 million.

Quorum Health Group Inc.’s purchase of Northwest Health Systems Inc. came in 11th on the list, but the purchase price was likely significantly higher than the listed price of $66 million.

Northwest Health System consists of both Northwest Medical Center in Springdale and Bates Medical Center in Bentonville. The $66 million is the amount Quorum paid for the system’s real estate. For all Northwest’s assets it purchased, Quorum probably paid more than $140 million.

National Home Centers Inc. sold off the rest of its retail stores as part of its decision to concentrate on contractor sales.

Lowe’s Cos. of North Wilkesboro, N.C., purchased the company’s Rogers store for $10.9 million. The Home Depot Inc. of Atlanta paid $5.9 million for the Fayetteville store.

Bank transactions

Several bank deals made the list as consolidation continued in the banking industry. Arvest Bank Group Inc., based in Bentonville, expanded its Oklahoma operations with the purchase of Ameri Bank Corp. of Shawnee, a deal valued at $28.8 million, and United Oklahoma Bancshares Inc. of Del City, a transaction valued at $18.6 million.

Chambers Bancshares Inc. of Danville paid $10.75 million for the Bank of Elkins and nearly $5 million for Community Bank of Fayetteville. The latter deal hasn’t closed yet but was announced last October.

Simmons First National Corp. of Pine Bluff bought Bank of Lincoln for $42 million.