CINCINNATI -- The Kroger Co. intends to explore strategic alternatives for its convenience-store business, including a potential sale, the company said at its annual investor conference in announcing Restock Kroger, a plan “to redefine the food and grocery customer experience in America.”
The decision is the result of a review of “assets that are potentially of more value outside of the company than as part of Kroger,” the company said.
The company has hired Goldman Sachs & Co. to identify, review and evaluate the options.
"Our convenience stores are strong, successful and growing with the potential to grow even more," said Mike Schlotman, Kroger's executive vice president and CFO. "We want to look at all options to ensure this part of the business is meeting its full potential. Considering the current premium multiples for convenience stores, we feel it is our obligation as a management team to undertake this review."
Cincinnati-based Kroger's c-store business includes 784 locations in 18 states. It includes 68 franchise operations. The stores employ 11,000 associates and operate under the following banner names: Turkey Hill Minit Markets, Loaf 'N Jug, KwikShop, Tom Thumb and QuickStop. Neither supermarket fuel centers nor Turkey Hill Dairy is included in this review, the company said. Kroger's convenience-store division ranked No. 10 on CSP's 2017 Top 202 list of the largest c-store chains in the United States.
Kroger's convenience-store business generated revenue of $1.4 billion in inside sales. Including fuel, Kroger's c-store business generated $4 billion in total sales last year. It sold 1.2 billion gallons of fuel in 2016. The business unit has delivered 62 consecutive quarters of identical-store sales growth, said the company.
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