The deal comes more than a year after Supervalu announced that it was exploring options for a separation of the Save-A-Lot business, including a possible spin-off. Supervalu this year had filed with the Securities and Exchange Commission to prepare for a potential spin-off, and in August the company said it also would consider a sale of the business.
Save-A-Lot has 1,368 stores across 37 states, the Caribbean and Central America, of which 896 are operated by licensee owners.
The sale is “another important step in Supervalu’s transformation,” said president and chief executive officer Mark Gross. “It provides us with a stronger balance sheet that will allow us to further build on our core strengths and growth opportunities. It has been a pleasure to work with the Save-A-Lot team and, once this transaction is completed, I look forward to continuing to work with them as one of our largest professional services customers.”
Under a five-year professional services agreement, Supervalu will provide Save-A-Lot with support functions for its day-to-day operations, including cloud services, merchandising technology, payroll, finance, and other technology and hosting services.
Supervalu and Onex said they expect the transaction to be completed by January 31, pending regulatory approvals and other customary closing conditions.
“This is an exciting development in the history of Save-A-Lot,” stated Eric Claus, who was named the company’s CEO in December. “As an independent company, we can more effectively focus on our growth and operating objectives. Onex’s experience and successful investment track record, specifically in corporate carve-outs, positions it as a strong partner for us, and we look forward to working with them.”