SuperValu Inc (NYSE:SVU) has entered into a definitive agreement to acquire 22 Food Lion grocery stores that are being sold in connection with the merger between Ahold and Delhaize.
The 22 Food Lion stores are in northern West Virginia, western Maryland, south central Pennsylvania, and northwestern Virginia. These acquired stores will be converted to SuperValu’s Shop ‘N Save format and at least initially be operated by SuperValu. That company is in discussions with certain of its wholesale customers and the Federal Trade Commission (FTC) on ways for SuperValu’s wholesale customers to have an interest in these stores going forward.
SuperValu supplies and supports nearly 100 independently operated Shop ‘N Save stores located primarily in western Pennsylvania and West Virginia. These independently operated stores are a key component of its wholesale business. The 22 acquired stores are not part of SuperValu’s corporately owned Shop ‘n Save retail banner comprised of 44 stores in the St Louis MO area.
The stores being acquired are conventional supermarkets that are about 35,000 square feet in size. As Shop ‘N Save stores, the plan will be to deliver a full-variety meat department, full-service delis and bakeries and an expanded produce department. The 22 stores currently employ more than 1,200 full and part-time associates. As part of the acquisition, SuperValu anticipates offering employment to substantially all interested employees.
Acquisition of the 22 stores is subject to customary closing conditions, including approval by the Federal Trade Commission. It is expected to be completed in a staggered closing process over the next 105 days.