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Blackwells presses Supervalu

May 17, 2018 11:13 AM ETSUPERVALU Inc. (SVU) StockBy: Clark Schultz, SA News Editor13 Comments
  • Blackwells Capital posts an open letter to the Supervalu (NYSE:SVU +1.5%) board of directors.
  • The alternative investment firm says there is significant value in Supervalu that needs to be unlocked after years of "continuous value destruction" as a result of misguided and haphazard strategy.
  • Blackwells is pushing for board representation and wants to know why the Supervalu annual meeting hasn't been scheduled yet.
  • The firm holds an ownership stake of 5.2% in Supervalu.
  • Source: Press Release

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Comments (13)

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Value-Pick profile picture
SVU added today
Mark Krieger profile picture
today the stock is a total disaster...

I'm sick of its constant crash and burn routine, and so is my pocketbook
Blackwells is trying to 'cigar butt' the company, thinking it's real estate and retail grocery stores are worth more than the stock price, they are trying to accelerate it for a near-term profit.

I have to say, that profit will never come. SVU is strictly a play on rural, independent grocers that literally nobody else will wholesale to. Save-A-Lot, which SVU unwisely divested of is handily outside AMZN or KR or other middle-class plays.

There is ALDI and soon LIDL for US discount groceres that compete with SVU's rural, regional customers.
toh192 profile picture
Actually what they are doing is pushing news to pump the price so they can exit. A board seat will not be had, and they know it. This same thing happened to Alaska communications recently.
They're doing a pretty bad job at pumping the price. If they were smart and had short-term aims, they would be advocating measures that make the company more attractive for a buy out and advocate exactly that.

SVU selling their real estate to some dirtbag REIT with spendy lease agreements is exactly the wrong direction. A buyout would be after the owned real estate and physical assets and less their intangibles. Without their physical property, SVU isn't much, yes, it's a highly efficient logistics company, but it's one big generic discount brand designed around being the cheapest, there is no loyal customer base or anything to acquire. M&A would be focused on real estate and these lease-back agreements Blackwell is pressuring management with are toxic to the company.
toh192 profile picture
I'm just saying the board will quickly shoot down another member and they will fail to disclose it until after they exit if at all.
I am a long term sharholder of SVU and I don't actually appreciate Blackwell's ideas. I don't know why they decided to go activist for SVU. The company could sell all of it's property, it's entire truck fleet, all of it's pallets of goods and it's not going to produce a company with huge valuation.

Somebody tell me how selling very valuable warehouses below market, then leasing them back at 8.7% is good business.

Blackwell is probably desperate or retarded. SVU isn't a company to activist about. There is nothing to do to unlock value that management isn't already doing, and even if, the dumb-ass AMZN bulls will sell conventional grocery anyways.
toh192 profile picture
it's corporate raiding for sure, but the board is doing it now. They sold off their retail locations instead of francished them. SVU could make a push to supply non gas c-stores but management would rather play mindsweeper.
Roojoo Capital profile picture
Rusty, couldn't agree more.
Sure is nice. Stir the pot !
11146471 profile picture
Nice to have some activists in.

I just love them.
gladysz profile picture
Yes, throw out the entire board. Shareholders need to do more of such housecleaning. I always wonder about the lavish catered lunches/dinners at the board meetings, also all the first class airfare for those to attend, fat daily honoraria, etc.
Mark Krieger profile picture
the reason for today's nice rally. Shorts are too scared to remain in a bearish position.

the more pressure, the better.

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