Southeastern Grocers is continuing to shed its Winn-Dixie stores in the Gulf States. The company, which last week announced a deal to sell eight units in Southern Louisiana to Brookshire Grocery Co., separately said it would sell another seven to Shoppers Value Foods, the Baton Rouge-based operator of 12 “cost-plus” concept stores.
A purchase price was not disclosed.
Shoppers Value said the deal would bring its concept to the New Orleans market for the first time, acquiring store in Avondale, Westwego, Harvey and Jefferson, La., in addition to two stores in Picayune, Miss., also considered a part of the New Orleans Metropolitan Statistical Area. A seventh store is located in nearby Laurel, Miss.
The deals provides further indication that Southeastern is looking to its Gulf State stores as a means to raise money while it negotiates with lenders over debts due later this year. Reports have said the company could look to restructure its debt under Chapter 11 of the U.S. Bankruptcy Code, which would give it the opportunity to exit leases for stores that it may not be able to sell. Reports earlier this month said the company could shutter as many as 200 stores, although officials have not confirmed that.
Winn-Dixie holds a No. 3 market share position in New Orleans, behind Walmart and Rouses, according to Metro Market Studies.
Shoppers Value said it anticipated taking possession of the stores beginning late next month. It said it anticipates renovating them over a three- to six-month period and reopening them under the Shoppers Value banner.
“We are pleased to have reached an agreement with SEG for these seven stores, which are a natural complement to our current store footprint,” Shoppers Value CFO Danielle Satawa said in a statement. “The addition of these stores brings our presence to New Orleans and expands our Mississippi markets. We are grateful for the opportunity to serve these communities and continuing to provide the quality that customers have come to expect now under the Shoppers Value Foods banner. We recognize that one of the greatest assets of a grocer is the people that help customers each day, and we are excited to meet many of the Winn-Dixie associates in the coming [days and weeks] as they explore the opportunity to join our Shoppers Value family.”
Shoppers Value runs stores under the “cost-plus” discount format, which offers shoppers all items at the cost to the grocer, plus a 10% surcharge on the basket. Shoppers Value is a national program for independent operators available through supplier Supervalu, which has grown rapidly in rural markets in recent years.
“Shoppers Value is a strong partner for our stores and recognizes the value that these locations provide to the communities in which they operate,” said Trey Edwards, Winn-Dixie Regional VP for Alabama, Louisiana and Mississippi. “Much like Winn-Dixie, Shoppers Value is committed to providing real savings to its customers. We are working together to ensure a seamless transition, and we are confident that the stores being transferred and the talented associates based in these locations are well-positioned for success as they continue bringing value to customers. We would like to thank the loyal customers who have shopped at these locations and our team of hardworking associates for their commitment to serving our customers.”