Dutch-based supermarkets operator Ahold has reached a deal to buy Belgian peer Delhaize, the companies announced yesterday, in a move that will create the sixth-largest food retailer in the US and the biggest in Europe’s Benelux region.

In a joint statement, the two companies said Ahold would have a 61 per cent stake in the merged entity, which will have €54.1 billion in sales, more than 6,500 stores worldwide and complementary operations in the US and Benelux.

Ahold, best known in Europe as owning the Albert Heijn chain of supermarkets in the Netherlands, is operator of Stop&Shop and Giant stores in the US, while Delhaize owns the Food Lion and Hannaford chains.

The Dutch group said it would pay 4.75 shares for every Delhaize share, valuing Delhaize at about €9.3 billion, or €90 a share, based on closing prices on Tuesday.

Ahold said it would return €1 billion to its shareholders

However, Ahold said it would return €1 billion to its shareholders with a special dividend and reverse stock split prior to the merger.

Ahold shares had a market value yesterday of €17.3 billion, while Delhaize’s was €8.7 billion.

“The deal looks good for Ahold shareholders; they are getting €1 billion in cash and paying only a 27 per cent premium for Delhaize, well below some of the initial estimates,” said Bernstein analyst Bruno Monteyne.

Since merger talks were announced on May 11, shares in Ahold have gained more than 10 per cent and Delhaize more than 20 per cent.

The merged entity, which will be headed by Ahold chief executive Dick Boer, would gain €500 million in synergies annually from combining operations, to be reached by the third year after the merger, the companies said. The companies expect the deal to close in mid-2016 and Boer said he did not expect any difficulties receiving regulatory approvals.

“We’re really complementary to each other in most of our markets, that’s the uniqueness of this merger,” he said.