Supervalu selling 21 Farm Fresh stores to Harris Teeter, Kroger Mid-Atlantic and Food Lion
Minneapolis-based Supervalu has entered into three separate agreements to sell 21 of its 38 Farm Fresh Food & Pharmacy stores for approximately $43 million in cash to three different retailers: Harris Teeter, Kroger Mid-Atlantic Division, and Food Lion. Supervalu is also continuing discussions and exploring potential transactions to sell the remaining Farm Fresh stores to current and prospective wholesale customers and certain Farm Fresh employees.
In summary, the agreements provide for:
• 10 stores being sold to Harris Teeter, including six in-store pharmacies and three fuel centers.
• Eight stores being sold to Kroger Mid-Atlantic Division, including eight in-store pharmacies and four fuel centers.
• Three stores being sold to Food Lion, including three in-store pharmacies.
“Over the past two years, we’ve been working diligently and rapidly to transform our business to become the wholesale supplier of choice for grocery retailers across the United States,” said Mark Gross, Supervalu’s president and CEO. “In 2016, we sold Save-A-Lot and its network of approximately 1,350 retail locations. Last year, we acquired Unified Grocers and Associated Grocers of Florida, which when combined with substantial organic growth, added more than $5 billion in run rate sales to bring our core wholesale business to nearly $13 billion.”
Gross said exiting the Farm Fresh banner will enable Supervalu to allocate greater resources and energy toward the strategic growth of its wholesale business.
“We also continue to aggressively pursue other important initiatives, including the monetization of real estate through sale leaseback transactions and cost reduction across the company,” he added.
The transactions are expected to close in May.
Founded in 1957, Virginia Beach, Va.-based Farm Fresh has served Virginia and North Carolina for 60 years, and employs approximately 3,300 associates. Supervalu is one of the largest grocery wholesalers and retailers in the U.S. with annual sales of approximately $16 billion.