Thursday, July 12, 2012

The end may be near for Supervalu, Acme

Yesterday the board of directors for Minneapolis-based Supervalu (Acme, Save-A-Lot) said they are considering the sale of all or parts of the company, and will significantly cut expenses and capital spending.

The announcement came after Supervalu's financial results for its most recent quarter fell below expectations. The company's net earnings of $41 million were down 45% from the same period last year.

According to company leadership, fiscal 2013 capital expenditures would be reduced from previous estimates of $675 million to $450-$500 million, and operating expense cuts of $250 million can be expected over the next two years. In addition, Supervalu has suspended its dividend and replaced its current credit facility with a real estate backed loan.

In a conference call yesterday with analysts, CEO Craig Herkert said the company was not considering bankruptcy, but analysts believe it's a possible scenario considering the difficulty Supervalu will most likely face when trying to find a buyer.

Save-A-Lot, Supervalu's "limited-assortment" brand, is the banner analysts believe would be most attractive to a buyer. Other Supervalu brands include Albertsons, Jewel-Osco, Acme, Shaw's, Cub Foods and Shoppers.



3 comments:

  1. David, there are only a small % of local Acmes which are in "the green". Most are HAS BEENS. Just the other day Concord Township (Delco) officials verified that Wegmans has recently purchased land near one of the newest Acmes. Acme will be sold off in parts, just like Genuardi's, and the banner will disappear after the likes of Giant, Weis, Bottom Dollar, and ShopRite pick the few viable sites from Acme's carcass.

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  2. why would anyone in todays market shop at acme with there overpriced food? case in point . 46 oz breyers ice cream at 6.99 when you can get it at shop rite for $3.00 . you dont have to be a rocket scientist to figure out that the pricing at acme is outrageos and unreal . they have priced themselves out of business in the phila area . it doesnt work around here anymore

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  3. And the QUALITY is horrible at Acme. Last year after Maria's story about normal pricing appeared in the Inky, Acme executives decided to downgrade the quality of Lancaster Brand beef to a substandard commercial grade from USDA Choice sold at decent chains such as ShopRite and Giant. The new slogan at Acme is: "Lancaster Brand Beef is TOUGH as shoeleather".

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