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NY grocer Fairway gains in market debut

Fairway executives, including chairman Charles Santoro and chief

Fairway executives, including chairman Charles Santoro and chief executive Herb Ruetsch, join in the applause as their company Fairway Group Holdings, goes public Wednesday with the opening bell of Nasdaq MarketSite on Times Square. (April 17, 2013) Credit: AP

Shares of Fairway had a strong trading debut Wednesday, as the popular New York metro area grocery store chain outlined plans to expand its footprint.

The company priced the stock at $13 per share, above its forecast of $10 to $12. The shares closed up $4.35, or 33.46 percent, at $17.35.

Fairway is well-known among New York shoppers for offering relatively low prices and cramming its shelves with a wide assortment of groceries. The company, known for its "Like No Other Market" slogan, began as a fruit and vegetable stand in 1933 and has since expanded to a dozen locations in the region, including in Connecticut and New Jersey.

Fairway operates two locations on Long Island, in Plainview and Westbury.

The company expects net proceeds of about $158.8 million from the IPO. Fairway plans to open two new stores in 2014 and three to four stores a year after that.

Eventually, it says there's room for more than 300 additional U.S. locations. That would put it on par with organic grocer Whole Foods, which has 346 stores in North America and the United Kingdom.

Fairway is looking to grow at a time when the supermarket industry is facing greater competition from big-box retailers, drugstores and even dollar stores.

Sterling Investment Partners bought an 80 percent stake in Fairway in 2007.

In the fiscal year ended April 1, 2012, Fairway had revenue of $554.9 million, up 14 percent from a year earlier. It booked a loss of $36.7 million last year, and a loss of $39 million a year earlier, due to the cost of opening new stores.

Fairway is trading under the ticker FWM on the Nasdaq Stock Market.

-- With Keiko Morris

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