Company Agrees to Sell 21 Stores and
Continues Discussions to Sell Additional Farm Fresh Stores
Demonstrates Further Execution of Wholesale
Transformation Strategy
SUPERVALU INC. (NYSE: SVU) today announced it has entered into
three separate definitive agreements to sell 21 of its 38 Farm
Fresh Food & Pharmacy (“Farm Fresh”) 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.
“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. Exiting the Farm Fresh
banner will enable us to allocate greater resources and energy
toward the strategic growth of our 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. We are
confident our efforts are driving growth and enhancing our
competitive position.”
Gross continued, “This decision was not taken lightly given the
impact on our employees and the communities we serve, but we
strongly believe this decision is in the best long-term financial
and strategic interest of our business. Our leadership team and
board of directors remain committed to taking proactive steps to
transform our business and drive stockholder value.”
“We are thankful for the tremendous service our employees have
delivered at Farm Fresh through the years, and are grateful for the
opportunities we’ve had to share in the lives and special events of
our customers and employees across the Hampton Roads, Richmond,
Williamsburg, and Elizabeth City communities,” said Anne Dament,
Executive Vice President, Retail, Marketing and Private Brands. “We
are working with the buyers to ensure a smooth transition and we
expect them to offer positions to many Farm Fresh employees. In
addition, we plan to offer eligible employees severance and other
job transition support.”
In summary, the agreements provide for:
- Ten 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
The transactions, which were unanimously approved by SUPERVALU’s
board of directors, are currently expected to close in May 2018,
subject to customary closing conditions. SUPERVALU is also working
with a third party to liquidate the inventory at these Farm Fresh
stores.
With regards to Farm Fresh pharmacies not included in these
three sale transactions, SUPERVALU has entered into agreements to
transfer pharmacy prescription files to other pharmacies in the
area. Prescription files from ten pharmacies will be transferred to
Rite Aid and four to CVS Pharmacy. Customers of these Farm Fresh
pharmacies will receive detailed information on the transfer of
their pharmacy files by mail within the next seven to ten days, and
information will also be available at each pharmacy.
A complete list of stores to be sold under the agreements, along
with a list of the impacted pharmacies and correlating pharmacies
where prescription files will be transferred, is included in the
addendum to this press release.
Founded in 1957, Farm Fresh has served Virginia and North
Carolina for 60 years, and today employs approximately 3,300
associates.
The Food Partners, LLC advised SUPERVALU on the transactions,
and is advising SUPERVALU on its continued exploration of the sale
of additional Farm Fresh stores.
About SUPERVALU INC.(The following information does not
include Associated Grocers of Florida which became part
of SUPERVALU on December 8, 2017)
SUPERVALU INC. is one of the largest grocery wholesalers
and retailers in the U.S. with annual sales of
approximately $16 billion. SUPERVALU serves
customers across the United States through a network of
3,324 stores composed of 3,111 wholesale primary stores
operated by customers serviced by SUPERVALU’s food distribution
business and 213 traditional retail grocery stores operated under
five retail banners in six geographic regions (store counts as of
December 2, 2017). Headquartered
in Minnesota, SUPERVALU has approximately 31,000
employees. For more information
about SUPERVALU visit www.supervalu.com.
Forward Looking
Statements
CAUTIONARY STATEMENTS RELEVANT TO FORWARD-LOOKING INFORMATION
FOR THE PURPOSE OF “SAFE HARBOR” PROVISIONS OF THE PRIVATE
SECURITIES LITIGATION REFORM ACT OF 1995.
Except for the historical and factual information, the matters
set forth in this news release, particularly those pertaining to
the expected completion of the sales of Farm Fresh stores
(including the timing thereof), the ability to consummate the sales
and SUPERVALU’s expectations, guidance, or future operating
results, and other statements identified by words such as
"estimates" "expects," "projects," "plans," "intends," "outlook"
and similar expressions are forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are
subject to risks and uncertainties that may cause actual results to
differ materially, including the ability to satisfy the closing
conditions and close the proposed sales on a timely basis or at
all, the possibility that modifications to the terms of the
transactions may be required, business disruption, ability to
effectively retain key employees and ability to effectively manage
organization changes during the pendency of or following the
transactions, and other risk factors relating to the business or
industry as detailed from time to time in SUPERVALU's reports filed
with the SEC. You should not place undue reliance on these
forward-looking statements, which speak only as of the date of this
news release. For more information, see the risk factors described
in SUPERVALU’S Annual Reports on Form 10-K, Quarterly Reports on
Form 10-Q and other filings with the SEC. Unless legally required,
SUPERVALU undertakes no obligation to update or revise publicly any
forward-looking statements, whether as a result of new information,
future events or otherwise.
LIST OF FARM FRESH STORES BEING SOLD AS PART OF THIS
ANNOUNCEMENT
Farm Fresh Store
Location
City/State
Zip
Acquiring
Buyer
1615 General Booth Blvd Virginia Beach, VA
23454 Food Lion 683 Hughes Blvd
Elizabeth City, NC 27909 Food Lion 608
E Mercury Blvd Hampton, VA 23663
Food Lion 2110 Great Neck Shopping Center
Virginia Beach, VA 23454 Harris Teeter
227 Fox Hill Rd, A01 Hampton, VA 23669
Harris Teeter 4511 John Tyler Hwy
Williamsburg, VA 23185 Harris Teeter
3675 Bridge Rd Suffolk, VA 23435
Harris Teeter 1400 Kempsville Rd Suite 109
Chesapeake, VA 23320 Harris Teeter 179
W Ocean View Ave Norfolk, VA 23503
Harris Teeter 521 Laskin Rd Virginia
Beach, VA 23451 Harris Teeter 1069
Independence Blvd Virginia Beach, VA
23455 Harris Teeter 730 W 21st St
Norfolk, VA 23517 Harris Teeter 2129
General Booth Blvd Virginia Beach, VA
23454 Harris Teeter 1401 N Main St
Suffolk, VA 23434 Kroger Mid-Atlantic
Division 230 E Little Creek Rd Norfolk, VA
23505 Kroger Mid-Atlantic Division 2190
Coliseum Dr Hampton, VA 23666
Kroger Mid-Atlantic Division 309 S Battlefield Blvd
Chesapeake, VA 23322 Kroger
Mid-Atlantic Division 1282 Smithfield Plaza
Smithfield, VA 23430 Kroger
Mid-Atlantic Division 6500-c George Washington Memorial Hwy
Yorktown, VA 23692 Kroger
Mid-Atlantic Division 1464 Mt. Pleasant Rd
Chesapeake, VA 23320 Kroger
Mid-Atlantic Division 7254 George Washington Memorial Hwy
Hayes, VA 23072 Kroger
Mid-Atlantic Division
LIST OF REMAINING FARM FRESH PHARMACIES AND
WHERE PRESCRIPTION FILES ARE BEING TRANSFERRED
Farm Fresh
Pharmacy Location
City/State
Zip
Where
Prescription Files are Being Transferred
1620 Cedar Road Chesapeake, VA 23322
Rite Aid: 1415 Cedar Rd., Chesapeake VA 23322
701 A. N. Battlefield Boulevard Chesapeake, VA
23320
Rite Aid: 101 Gainsborough
Square, Chesapeake VA 23320 1459 Armory Drive
Franklin, VA 23851
Rite Aid:
1031 Armory Drive, Franklin VA 23851 30 Towne Center Way
Hampton, VA 23666
Rite
Aid: 40 Towne Centre Way, Hampton VA 23666 601 Children’s Lane
Norfolk, VA 23507
Rite
Aid: 525 West 21st St., Norfolk VA 23517 201 E. Berkley Avenue
Norfolk, VA 23523
Rite
Aid: 2040 Atlantic Ave., Chesapeake VA 23324 460 Wythe Creek
Road Poquoson, VA 23662
Rite Aid: 421 Wythe Creek Rd., Poquoson VA 23662 799 Chimney
Hill Shopping Center Virginia Beach, VA
23452
Rite Aid: 1177 S. Rosemont Rd., Virginia
Beach VA 23453 4001 Virginia Beach Boulevard Virginia
Beach, VA 23452
Rite Aid: 3653
Virginia Beach Blvd., Virginia Beach VA 23452 2058 S. Independence
Boulevard Virginia Beach, VA 23453
Rite Aid: 1808 Salem Road, Virginia Beach VA
23456 353 Chatham Drive Newport News, VA
23602
CVS Pharmacy: 12755 Jefferson
Avenue 4000 Victory Boulevard Portsmouth, VA
23701
CVS Pharmacy: 1800 Frederick
Boulevard, Portsmouth, VA 23707 4876 Princess Anne Road
Virginia Beach, VA 23462
CVS
Pharmacy: 4500 Princess Anne Road, Virginia Beach, VA 23462 115
Norge Lane Williamsburg, VA 23188
CVS Pharmacy: 7529 Richmond Road,
Williamsburg, VA 23188 1200 North Military Highway
Norfolk, VA 23502 Customers to be
notified within the next seven to ten days 928 Diamond Spring Road
Virginia Beach, VA 23455
Customers to be notified within the next seven to ten days
NOTE: Customers of these Farm Fresh pharmacies will
receive detailed information on the transfer of their pharmacy
files by mail within the next several days, and information will
also be available at each Farm Fresh pharmacy.
View source
version on businesswire.com: http://www.businesswire.com/news/home/20180314006241/en/
For SUPERVALU Inquiries:Investors:Steve
Bloomquist,
952-828-4144steve.j.bloomquist@supervalu.comorMedia:Jeff
Swanson, 952-903-1645jeffrey.s.swanson@supervalu.com
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