Operations Southeast Store News

Supervalu Exiting Farm Fresh Banner, Buyers Include Harris Teeter, Kroger

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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

  

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

Keep reading:

Acquisitions Help Supervalu Increase Net Sales

Supervalu Promotes Woseth To Chief Financial Officer

Activist Investor Pushes For Major Changes At Supervalu, Suggests Breakup

About the author

Alissa Marchat

A word nerd, grocery geek and three-year member of The Shelby Report. She is a proud new homeowner and a great lover of avocado toast.

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