In brief: Supervalu to sell chains, including Albertsons
NEW YORK – Supervalu Inc. is selling off five of its grocery chains, including Albertsons and Jewel-Osco, after years of being squeezed by intensifying competition.
The nation’s No. 3 traditional supermarket operator said Thursday that the sale of 877 stores to an investor group led by Cerberus Capital Management will also include Acme, Shaw’s and Star Market. The group already owns about 200 Albertsons in the South and Southwest.
Following the sale, Supervalu will focus on its Save-A-Lot discount stores, as well as its smaller regional chains Cub, Farm Fresh, Shoppers, Shop ’n Save and Hornbacher’s. It will also keep its wholesale business that distributes groceries to stores.
The investor group will pay $100 million in cash for the stores, and the new company will assume $3.2 billion in existing debt. Cerberus will also offer to buy up to 30 percent of the remaining Supervalu for $4 per share after the deal closes.
Supervalu has struggled for years to turn around its business. The broader supermarket industry has been facing growing competition from big-box retailers such as Target, drugstore chains and dollar stores. While bigger chains such as Kroger Co. have adapted by tweaking store formats and improving discount programs and product offerings, Supervalu has scrambled to keep pace.
Documents on Wal-Mart bribery inquiry released
NEW YORK – Wal-Mart Stores Inc.’s CEO Mike Duke found out in 2005 that the retailer’s Mexico unit was handing out bribes to local officials, according to emails obtained by lawmakers.
The lawmakers say the emails contradict earlier claims by Wal-Mart that executives weren’t aware of bribes being made by the company.
Democratic congressmen Elijah E. Cummings and Henry A. Waxman, who are investigating bribery charges at Wal-Mart’s Mexico division, on Thursday released emails that indicate that Duke and other senior Wal-Mart officials were informed multiple times starting in 2005 about bribes being made in the country. U.S. law forbids American companies from bribing foreign officials.
The lawmakers shared the emails, which they say they got from a confidential source, with Wal-Mart on Wednesday, and sent a letter to Duke asking for a meeting to discuss them.
“It would be a serious matter if the CEO of one of our nation’s largest companies failed to address allegations of a bribery scheme,” according to the letter written by Waxman and Cummings to Duke.
Brooke Buchanan, a Wal-Mart spokeswoman, said on Thursday that the letter that Waxman and Cummings wrote to Duke “leaves the wrong impression that our public statements are contradicted by the information they released today.”
Starbucks to fight for Tully’s Coffee
SEATTLE – Starbucks says it will support efforts to have a bankruptcy court reconsider bids to purchase Tully’s Coffee.
The company said this week it plans to back a filing in which Tully’s franchisee AgriNurture outlines why it believes AgriNurture and Starbucks’ bids should be accepted.
The companies hope to derail a $9.15 million bid from actor Patrick Dempsey and his investor group that Tully’s and its creditors chose last week in a private auction.
Together, Starbucks and AgriNurture have offered to buy all 47 Tully’s locations for $10.56 million. Starbucks wants 25 of those stores, which it would rebrand Starbucks.
The case is to be heard Friday in U.S. Bankruptcy Court in Seattle.