SUPERVALU INC. (NYSE:SVU) has acquired a 930,000-square-foot warehouse in Joliet that belonged to Strack & Van Til whose parent firm is Central Grocers.
Supervalu purchased the Joliet warehouse for $61 million and the acquisition comes as a massive relief to Central Grocers. The latter has been facing bankruptcy and has been trying to sell the warehouse since December last year. The sale of the warehouse was approved by Judge Pamela S. Hollis of the U.S. Bankruptcy Court in Northern District of Illinois.
Supervalu which has its headquarters in Minneapolis distributes products to more than 2,000 stores across the U.S. It also happens to be taking over as the supplier to some of the 400 independent grocery stores in greater Chicagoland and Northwest Indiana that were previously served by Central Grocer.
“We’ve recently added several new customers, who are formally supplied by Central Grocers and we hope to build on that success over the balance of the year,” stated Mark Gross, the president and CEO of Supervalu during an investor call.
Robert Woseth, the chief strategy officer at Supervalu also pointed out during the investor conference call that customers from Central Grocers played a key role in the company’s $280 million wholesale revenue increment. He stated that the company stated shipping to some of Central Grocers customers during the quarter.
The warehouse which is now exchanging ownership had roughly 550 workers including the logistic workers and the truckers. The Joliet distribution center was opened in 2009 by Central Grocers but things recently started going downhill. The firm has been laying off workers at the warehouse ever since it filed for bankruptcy on May 4. The firm has so far laid off more than 2,000 employees just this year and most of them were from the Strack & Van Til and Ultra Foods stores.
Central Grocers had initially planned to dispose some of its assets but it resorted to letting go of some of its workers in order to stay afloat. The company was once ranked among the top seven wholesale grocers in the U.S with an annual revenue of $2 billion.
Supervalu stock closed the latest trading session on Thursday at $3.58.
The post SUPERVALU INC. (NYSE:SVU) Acquires Central Grocers’ Distribution Center In Joliet appeared first on Market Exclusive.
© Market Exclusive 2017, source Market Exclusive