October 17, 2016 - 6:02 AM
NEW YORK - Supervalu said Monday that it is selling its Save-A-Lot supermarket chain for $1.37 billion to Canadian private equity firm Onex Corp.
The deal is expected to close before the end of January.
Supervalu, based in Eden Prairie, Minnesota, distributes grocery items to supermarkets and provides other services to them. The company also owns the Shop 'N Save and Cub Foods chains. There are more than 1,300 Save-A-Lot grocery stores.
Supervalu first announced plans to sell off Save-A-Lot last year to focus on growing its distribution business. Supervalu says it signed a five-year deal with Save-A-Lot to provide cloud technology, as well as payroll, finance and merchandising technology services. The company said it will use some of the money from the sale to pay down debt.
Shares of Supervalu Inc. rose 3.8 per cent to $5.20 before the stock market opened Monday. Its shares are down about 30 per cent in the last 12 months.
News from © The Associated Press, 2016