SuperValu CEO Mark Gross Discusses Growth Strategy and Additional Acquisitions



SuperValu CEO Mark Gross Discusses Growth Strategy and Additional Acquisitions


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EDEN PRAIRIE, MN - The retail grocery sector is rapidly changing, and amidst the flurry of sales and acquisitions over the past year, SuperValu Inc. has played its cards in both capacities, with more potential distributor purchases on the horizon.

Following last year's sale of its retail banner, Save-A-Lot, and the subsequent acquisition of wholesaler Unified Grocers, SuperValu CEO, Mark Gross recently confirmed the company will be shifting its focus to distribution, according to the Minneapolis/St. Paul Business Journal.

Mark Gross, CEO, SuperValu"Showing people we can do that [Unified Grocers] deal and showing our customer base that that integration goes smoothly should lead to other opportunities," Gross said during the RBC Capital Markets Consumer and Retail Conference. "There are other smaller distributors, and we would think those people would see that transaction and say they would want to be a part of our larger organization."

SuperValu is currently in the process of completing the $375 million deal for Unified Grocers, and as the closing comes into sight, Gross shared that he sees plenty of opportunity for additional distributor acquisitions in the future, while seeking to sell its remaining underperforming retail banners.

SuperValu Truck

"I’m a grocery wholesaler. I’ve run retail, but I’m first and foremost a wholesaler and that’s where I believe our strengths lie," Gross said. "That is our core business and that’s where our growth lies."

Same-store sales for SuperValu's retail division fell 5.8 percent last quarter, prompting the company to shift its strategy to distribution and sell off retail operations, such as Save-A-Lot, which it closed a $14 billion deal on during the past quarter.

"Our innovation team continues to evaluate and implement initiatives that we expect will contribute toward profitability, and we're in the process of marketing a number of underperforming stores where disposition would allow us to focus on a core base of stronger stores," Gross said last month, as transcribed by Seeking Alpha in an earnings call.

Cub Foods storefront

Some of the retail banners left in the SuperValu portfolio include: Cub Foods, Shop N’ Save, Shoppers, Farm Fresh, and Hornbachers. The company has not totally abandoned these chains, with recent investments and new innovations sprinkled throughout its operations, along with key executive hires to bolster the retail brands.

What else might SuperValu do in accordance with this shifting strategy? Follow along with AndNowUKnow as we continue to report.

Supervalu