Canadian Investor Bids Highest for Save-A-Lot
A Canadian private equity firm was the highest bidder in an auction for Earth City, Mo.-based Save-A-Lot, the deep-discounter branch of Eden Prairie, Minn.-based wholesaler and grocer Supervalu.
The bid from Onex Corp., based in Toronto, hasn't been undisclosed, but sources previously have indicated that Save-A-Lot could be worth as much as $1.8 billion, Reuters reported. More than 1,300 Save-A-Lot stores operate nationwide; as of June 18, the retailer operates 472 of them, while licensees operate 896.
Supervalu is considering the sale of Save-A-Lot as an alternative to a spinoff, which it first proposed in July 2015. It's anticipated to make a final decision about the chain within the next two weeks.
Although a sale would result in Supervalu losing one of its fastest-growing businesses, it also would help alleviate recent burdens and allow the company to focus on its wholesale operations. The company recently cut its full-year profit guidance for fiscal 2017, following wider-than-expected losses in its retail and Save-A-Lot businesses.