Supervalu Inc. is shedding more stores, selling 19 supermarkets, plus one standalone pharmacy, to St. Louis-based Schnuck Markets Inc.
Kirkwood, Mo.-based Shop n’ Save operates 36 stores, primarily in the St. Louis area. Minneapolis-based Supervalu announced its intent to sell the Shop n’ Save banner and close the related distribution center servicing the stores earlier this year.
If a buyer is not found for the remaining 17 stores, Supervalu said it plans to close them by the end of 2018.
“Since announcing plans to pursue the sale of our Shop ‘n Save banner earlier this spring, the team has worked diligently and successfully to put this agreement together,” said Mark Gross, Supervalu president and CEO, in a news release. “This transaction is an important step in the continued transformation of our business.”
As part of the deal, Supervalu also will become the primary supplier for nine of Schnucks’ existing stores in northern Illinois, Iowa and Wisconsin.
United Natural Foods Inc., Providence, R.I., agreed to acquire Supervalu in July for $2.9 billion. Analysts expect Supervalu to continue its focus on wholesale business, and the company has been selling off retail locations over the past couple of years. The most recent transaction, Farm Fresh on the East Coast, closed during the first quarter of fiscal 2019. Twenty-one stores were sold to Harris Teeter, Kroger and Food Lion, and five were sold to independents. Supervalu also sold Save-A-Lot, its discount banner, in late 2016.
Schnuck Markets, which operates about 100 stores in Missouri, Illinois, Indiana, Wisconsin and Iowa, is the 170th largest privately-owned company in the U.S.
A staggered close process is expected to start Oct. 7, wherein Schnucks plans to close Shop ‘n Save stores for about two and a half days to convert them to the Schnucks banner.
“Schnucks is proud to be growing in our hometown of St. Louis, excited about the opportunity to serve new customers, and looking forward to welcoming the employees at these 19 stores to Schnucks,” said Todd Schnuck, chairman and CEO, in a news release. “We want longtime customers of each store to know that we are eager to earn your business, and we’ll be working closely with Supervalu and Shop ‘n Save to ensure a smooth transition.”
Pamela Riemenschneider is the Retail Editor at Blue Book Services, Inc.