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Report: Bi-Lo Sale Has Received Multiple Bids

NEW YORK - Multiple bids have been submitted to buy Mauldin, South Carolina-based Bi-Lo, and the sale is expected to happen by year's end, according to a published report. However, analysts speculate on whether the winning bidder will be a supermarket company.

Timothy Carroll, who was hired to handle the sale of Bi-Lo and its sister chain Bruno's, both owned by Ahold, told the Charlotte Observer that the sale should be completed by year's end, if not sooner. Carroll, who is with the Chicago-based firm William Blair & Company, LLC, said he still believes the company's goal to sell the business is attainable.

Ahold said in February that it planned to sell Bi-Lo and Alabama-based Bruno's, in an effort to reduce debt amid reports the company had overstated earnings. Bids were due around the end of June, and a Bi-Lo spokeswoman told the newspaper that there are still several bidders in the running.

Earlier in the year, Publix was named as a potential buyer for both chains, although the company wouldn't speculate whether it was pursuing a deal.

However, some analysts question whether the ultimate buyer of Bi-Lo and Bruno's will indeed be a grocery company, especially since grocers are emboiled in such a competitive market, with many facing tough labor negotiations. Instead, the chains may be sold to a buyout firm or private investment group.

"No one in the North American supermarket sector is buying from supermarket operating companies right now. Major chains are closing stores and disassembling the empires they've built in recent years," Burt Flickinger, managing director at the New York-based consultancy Strategic Resource Group, told Progressive Grocer. "We're in a cycle again in which financial firms are building up and managing chains."

Additionally, larger chains such as Albertsons, which bought Shaw's earlier this year, have been facing intense union negotiations, which would be factored in when considering acquisitions, Flickinger said. Meanwhile, it remains to be seen whether or not the presidential election in November will affect acquisition concerns among the Federal Trade Commission, he added.

Ahold might want to explore also bringing in a larger, global investment firm that would be more closely connected to international chains such as Carrefour, Flickinger noted, since companies in Europe and Asia may find U.S. opportunities attractive.
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