Supervalu has entered into three separate definitive 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 also is 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 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.
“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.”
Added Anne Dament, EVP, retail, marketing and private brands, “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. 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 expected to close in May 2018, subject to customary closing conditions. Supervalu also is working with a third party to liquidate the inventory at these Farm Fresh stores.
“We are so excited to add these three new locations to our network of more than 100 stores serving the greater Norfolk area,” said Food Lion President Meg Ham. “We are part of the fabric of this community. We’ve been here in the towns and cities of Hampton Roads nourishing our neighbors and customers for nearly 40 years. With the addition of these three new stores, we have an even greater opportunity to serve more customers with fresh, quality products at affordable prices every day with the caring, friendly service they expect from Food Lion.”
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.
Founded in 1957, Farm Fresh has served Virginia and North Carolina for 60 years, and today employs approximately 3,300 associates.
See the complete list of stores to be sold under the agreements here:
Farm Fresh Store Location
|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|