This one will be of interest to many readers, especially those of us in Chicagoland. Supervalu, the parent company of our largest supermarket chain, Jewel-Osco, is putting itself up for sale after its newly-reported earnings were about half of what was expected. From the Star-Tribune:
With Supervalu Inc.’s financial performance spiraling from bad to worse and its stock at historic lows, the company said Wednesday it has put itself up for sale and has suspended its dividend payment.
The Eden Prairie-based supermarket operator, owner of the Twin Cities’ Cub Foods chain, Wednesday reported earnings that were about half of what Wall Street expected.
Supervalu’s stock has been trading at or near 30-year lows in recent months. As the stock has sunk, there’s been speculation a private equity group might make a run at the company. However, some of Supervalu’s operations are weak enough that it’s not clear whether they would fetch an acceptable price for the company’s shareholders.
Herkert noted that Supervalu is profitable and still has a cash flow that’s projected to be more than $1 billion this year.
Much of the company’s cost cuts will be will be used to accelerate its goal of lowering prices, a program that has already been in effect for several quarters. “We’re taking the steps necessary to move this along much faster,” Herkert said.
