Edit
Mergers & Acquisitions

'High Interest' in Potential Sale of Kroger's C-Store Business

Strategic review of grocer’s 780-unit convenience network continues

CINCINNATI -- There is a "high level of interest" by prospective buyers for Kroger Cos.’ convenience-store business, Mike Schlotman, executive vice president and CFO, said on the Cincinnati-based grocer’s third-quarter 2017 earnings call.

Schlotman and Kroger Chairman and CEO Rodney McMullen offered no additional details or a timetable for the decision.

Kroger said in October that it is exploring strategic alternatives, including a potential sale, for its approximately 780 c-stores under the Turkey Hill Minit Markets, Loaf 'N Jug, Kwik Shop, Tom Thumb and Quick Stop banners in 18 states.

At its annual investor conference in October, Kroger launched Restock Kroger, a plan “to redefine the food and grocery customer experience in America.” It includes the continued rollout of its order-online, pickup-at-store service, ClickList; home delivery; restaurants and ready-to-go meals; cutting food prices; and $3 billion in new-store construction, expansion and remodeling.

The decision to explore alternatives 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 at the time of the announcement.

Selling the c-store business could yield $1 billion to $2 billion that Kroger could reinvest back into its core business, reported USA Today. The company hired Goldman Sachs & Co. to identify, review and evaluate the options.

Kroger reported net earnings of $397 million for third-quarter 2017, a 1.5% increase over $391 million for third-quarter 2016. Total sales increased 4.5% to $27.7 billion in the quarter compared to $26.6 billion for the same period last year.

Kroger has 2,790 retail food stores under a variety of banners in 35 states and the District of Columbia. It has 2,266 pharmacies, 1,480 supermarket fuel centers, 783 c-stores, 306 jewelry stores, 219 retail health clinics and 38 food production plants.

Trending

More from our partners