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Supervalu (SVU +9.2%) extends gains following a WSJ article that the company expects to begin...

Supervalu (SVU +9.2%) extends gains following a WSJ article that the company expects to begin sending out financial information in the coming days to prospective buyers, including buyout firms and other supermarket operators and distributors. SVU said last week it had hired bankers to look at selling either part or all of itself. (earlier)
Comments (6)
  • I was right on the money. A buyout is coming.
    16 Jul 2012, 03:34 PM Reply Like
  • From whom? There will be store closures and asset sales; I cannot see any way out of that.
    16 Jul 2012, 03:40 PM Reply Like
  • What do we expect this company to be valued at at this point? $1B?
    16 Jul 2012, 03:40 PM Reply Like
  • Who will buy it? Their cost structure is uncompetitive, hence their high prices which are driving shoppers away. MS had a great report last week, showing the tough road ahead and that any buyout will likely be at disappointing valuations.
    16 Jul 2012, 10:31 PM Reply Like
  • I retired from SVU's Jewel Osco division (Chicago) in 2008 after 32 years service and draw a pension. I'm closely following SVU news particularly as it may relate to future pension viability. J/O (SVU) own much/most of the real estate in their Chicago/Chicago area store locations. Some very expensive real estate.....many in key "Main and Main" retail locations. Kroger is nearly absent (Food 4 Less banner) in this major metro market.....accordingly, I think Kroger has to be focusing on the situation/opportunity to possibly go big in Chicago. Safeway Chicago is very vulnerable, Aldi has all the limited assortment store business....Walmart keeps coming on strong.
    17 Jul 2012, 01:11 AM Reply Like
  • The way I see it.. The distribution part of the business is INCREDIBLE! any company, even the great Wall-Mart (where by the way prices have gone up significantly in everything including all the food items) would be buying a fantastic distribution division that I would say is VERY hard to guage full value of, but much value is there. Think about it. They sell the distribution division, perhaps with a few persks in the sale, like lowing their overall debt obligation. Regardless of those perks, this one move could change Supervalue as we know it forever...FOR THE MUCH BETTER! Imagine if they just kept opening more and mor sav-a-lot stores and became basically a sav-a-lot grocer. Over time they could sell off the traditional groceries nice and slowly, starting with the worst performing ones and continue to build and own andrun sa-a-lot. Thus they will have followed the needs of the times, they could enforce selling more of their owwn brand foods, which they are well into at this point. Stockholders could either get out now with th price obviously rising to $5-$6 per share or perhaps they could entice investors to stay on doing say a split of 2 for 1 or some other cockamamy wall street move that makes alot of investors want to stay on with what would be a VERY lean, mean grocery machine. This is their way out and their way of offering some of the losses back to investors. The big shots making way more profit per year, thus more money in their pockets. Hey, there s a time to sell a good part of your business if it can save everything else and help what remains produce very, very good profits...which sav-a-lot obviously can do. I think the empasis on the 6 billion debt, is WAY overplayed. Remember people this is a company bringing in 10 BILLION!./...not million but BILLION dollars$$$ per QUARTER! and after all the hoopla, they are STILL PROFITABLE.. read that again..They are still profitable. Just on the numbers and not the fears that wall-mart will take over the planet, they should be at least at $5.00 per share now. That would only be a reasonable 25 pe for a turnaround situation. Whats happening here is what always happens on Wall Street.. People are "remembering" their old "SUPERVALUE" making $6 per share. With sav-a-lot alone, bringing the number of stores to over 3500 to 4,000. And debt virtually bitten into like a dog biting on a bone...Heck...$6.00 per share profit with 4,000sav-a-lot stores is more than possible..It is likely. My two cents. Please respond..thanks
    20 Jul 2012, 01:32 AM Reply Like
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