Supervalu Files Plans to Spin Off Save-A-Lot Division
January 07 2016 - 03:30PM
Dow Jones News
Supermarket chain Supervalu Inc. on Thursday filed with
regulators plans to spin off its hard-discount division Save-A-Lot
as a public company, the latest move for Supervalu as it struggles
to cope with big changes reshaping the food-retail sector.
Supervalu said last summer it was considering spinning off
Save-A-Lot in a bid to help investors better understand and value
the low-price, no-frills chain. In Thursday's filing with the
Securities and Exchange Commission, Supervalu said its shareholders
would own at least 80% of the newly public Save-A-Lot company.
Supervalu didn't set a deadline for taking Save-A-Lot public,
and a company spokesman said there is no assurance the spin off
will occur.
Save-A-Lot has been a rare bright spot for Supervalu as it
attracted cost-conscious consumers while specialty chains led by
Whole Foods Market Inc. have lured wealthier shoppers. That has
left many traditional grocers, including Supervalu's other grocery
chains, in an unappealing middle ground. Some grocers have
responded by acquiring other stores, and others have gone out of
business.
Last summer, Supervalu Chief Executive Sam Duncan said splitting
off Save-A-Lot could enable Supervalu to focus on its other 200
grocery stores, like Farm Fresh and Cub Foods, and its wholesale
business, which is one of the largest in the country. He said such
a move could help Save-A-Lot become more competitive.
Write to Ilan Brat at ilan.brat@wsj.com
(END) Dow Jones Newswires
January 07, 2016 15:15 ET (20:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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