General Merchandise/HBC

Supervalu Selling Several Chains to Consortium

Includes Albertsons, Jewel-Osco, Shaw's; does not include Save-A-Lot

MINNEAPOLIS -- Months after it announced the possibility of a sale, Supervalu on Wednesday said it would sell its Albertsons, Acme, Jewel-Osco, Shaw's and Star Market stores, and related Osco and Sav-on in-store pharmacies, to a consortium of investors.

The consortium, let by Cerberus Capital Management LP, includes Kimco Realty Corp., Klaff Realty LP, Lubert-Adler Partners and Schottenstein Real Estate Group. The transaction is valued at $3.3 billion and includes 877 locations.

A tender offer for up to 30% of Supervalu's outstanding common stock will be conducted within 10 business days for $4 per share in cash.

Also, after the transaction closes, grocery retail veteran Sam Duncan will take the helm as president and CEO, replacing Wayne Sales, the company's current president, CEO and chairman.

Reuters reported that Supervalu logged a profit of $16 million, or eight cents per share, in the third quarter ended Dec. 1, compared with a year-earlier loss of $750 million, or $3.54 per share. For fiscal 2012, Supervalu last April recorded a sales decline of 3%, or $27.9 billion; and a loss of $1.04 billion, including a $519-million operating loss and $509 million in interest expense.

In September, As previously reported in CSP Daily News, Supervalu announced it would close 60 underperforming sites, including 22 Save-A-Lot locations. Save-A-Lot is the largest hard discount grocery chain in the United States, with about 1,300 stores.

According to the company, after the sale, Supervalu will consist of the Independent Business, a leading food wholesaler that serves 1,950 U.S. stores; Save-A-Lot; and Supervalu's leading regional retail food banners Cub, Farm Fresh, Shoppers, Shop 'n Save and Hornbacher's.

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