Kroger Tidies Up Its Asset Mix

Kroger kicked off this month with some pantry organizing. The Kroger Co. sold its Vitacost.com, Inc. subsidiary to iHerb, and the transaction closed January 8. Vitacost is an eCommerce retailer focused on health and wellness products, and Kroger positioned the move as part of a broader effort to tighten the company’s focus. For context, it's probably worth mentioning that Kroger stock was trading near a 52-week low of $58.12 prior to this sale and has experienced about a 14% decline over the past six months. Even after the sale, Kroger’s stock was down approximately 0.5%.

Kroger said it’s reviewing non-core assets to better support priorities like simplifying the organization, improving the customer experience, and focusing on Kroger’s core business. Kroger also said the sale is not expected to impact its previously issued 2025 financial guidance, and no additional financial terms were disclosed — so yes, the price tag is staying in the “private label” aisle.

On the buyer side, iHerb presented the deal as a strategic boost to its U.S. presence, saying it has completed its acquisition of Vitacost from Kroger and expects the combination to strengthen its position as a major online destination for wellness products. iHerb described Vitacost as offering over 40,000 health-conscious products, and said the acquired assets include the Vitacost brand, intellectual property, and existing inventory. Currently, iHerb is not a publicly traded company, and they also have not divulged any details about the purchase price.

So Kroger cleaned up the vitamin aisle and iHerb adds a well-known wellness brand to its platform. There are some unanswered questions surrounding this deal. Kroger shareholders are probably anxious to know, "how much did Kroger make off the deal, and how will those funds be reinvested? Kroger shares have been down awhile, are they ok?". As for iHerb, the big question is whether they are getting ready to go public. This might be something to keep an eye on, acquiring a well-known brand like Vitacost could indicate that iHerb is looking to strengthen its market presence, a basic strategy for companies gearing up for an IPO.

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