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Spartan Closes 2 Detroit Valu Land Stores

GRAND RAPIDS, Mich. — Spartan Stores has closed two of the three Valu Land stores it opened in the metro Detroit area.


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The stores, in Roseville and Dearborn, were open for a less than a year when they closed Dec. 7, sources told SN. Spartan officials were not available for comment.

The company considers its discount Valu Land format as a “test concept.” Dennis Eidson, Spartan’s chief executive officer, in a recent conference call said the Detroit market was “challenging” and that sales performance there was “lumpy.”

Spartan opened the Roseville Valu Land last December. The Dearborn location opened in February. Spartan continues to operate a Detroit area Valu Land in Warren, Mich., along with five other locations in Central and Northern Michigan.

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New Business Sparks Spartan Q2 Gains

GRAND RAPIDS, Mich. — Spartan Stores here on Wednesday said new customers and organic sales growth contributed to increased sales for the fiscal second quarter, while net earnings were down slightly.


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Consolidated net sales for the period, which ended Sept. 14, increased 4.5% to $ 649.5 million, boosted in part by contributions from a recent acquisition in the retail segment and new customers in the distribution segment. The sales increase reflected a 4.7% increase in distribution sales of $ 271.4 million; and retail sales of $ 378.1 million, a 4.4% increase. Retail same-store sales, excluding fuel, increased by 0.2%.

Net earnings for the period of $ 10.1 million decreased by 1.9%. Adjusted earnings from continuing operations totaled $ 12.1 million, which was ahead of the company’s forecast, Dennis Eidson, chief executive officer, said in a statement. Adjusted earnings account for merger expenses associated with Spartan’s pending acquisition of Nash Finch; and an asset impairment charge taken in the second quarter last year.

Read more: Spartan-Nash Finch Deal Clears FTC

“Despite a lack of meaningful food inflation, we posted top- and bottom-line gains in both our retail and distribution segments due to strong execution across our business segments, the effectiveness of our promotion programs and focus on cost control,” Eidson said. “We will continue to invest in the consumer experience to ensure a broad assortment of brand name and private brand products and encourage sales in our retail and distribution channels.”

Gross profit margin for the quarter was flat compared to the second quarter of the prior year at 21%. The gross profit margin reflects modest inflation in distribution segment and improved fuel margins.

During the second quarter, the company opened one Valu Land store, completed five minor remodels and store re-banners and acquired one pharmacy, ending the quarter with 102 corporate stores and 30 fuel centers.

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Spartan Fresh Potato Salad Recalled for Listeria Risk

Garden-Fresh Foods, Inc. of Milwaukee Wisconsin is recalling a limited quantity of Spartan Fresh Selections American Potato Salad in 16 oz. packages because it has the potential to be contaminated with Listeria monocytogenes, an organism which can cause serious and sometimes fatal infections in young children, frail or elderly people, and others with weakened immune systems.

Although healthy individuals may suffer only short-term symptoms such as high fever, severe headache, stiffness, nausea, abdominal pain and diarrhea, Listeria infection can cause miscarriages and stillbirths among pregnant women.

Spartan Fresh Selections American Potato Salad was distributed by Spartan Stores in the State of Michigan and Toledo, Ohio.

The affected Spartan Fresh Selections American Potato Salad is packaged in square 16 oz. plastic retail containers with a UPC Code Number 0 11213 90320 0 and a use-by date of Sept. 6 (09/06/13/04).

There have been no illnesses reported in connection with this product. However, due to the time required to trace illnesses back to a food source, it is impossible to say whether anyone has fallen ill.

The potential for contamination was noted after routine testing.

Consumers who have purchased this product should not open the package or use the contents. Instead, they should return the product to the location of purchase for a full refund.

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Spartan Launches Cooking/Nutrition Program for Kids

GRAND RAPIDS, Mich. — Spartan Stores here is the first company to launch a new online program designed to teach children basic cooking skills and develop their nutrition know-how.

The “Cooking Together, Cooking Forever” training program kicks off in October at Spartan’s Family Fare banner with a series of eight videos, released monthly. The videos include a “Nutrition Bytes” segment featuring Allison Reed, corporate dietitian at Spartan, who gives health tips related to the particular cooking technique — such as knife skills or roasting — taught in that month’s lesson.

Spartan Stores Corporate Dietitian Allison Reed“By teaching these cooking skills, we are giving families the tools they need to prepare healthy meals, not just by following a recipe, but actually learning how to cook,” Reed told SN. “The point of this program is to bring the focus back to home-cooked meals, get families in the kitchen, and make it easy for them to eat around the dinner table more often.

“I believe that eating more nutritious, home-cooked meals will lead to a healthier generation.”

The Cooking Together, Cooking Forever program was developed by Del Prince Marketing, Pittsburgh, which also runs the “Apples for the Students” cause-marketing program used by many supermarket operators.

“Obviously the obesity problem is … not something any one program is going to automatically correct, but it is a very simple issue — it is calories in, vs. calories out,” Mitch Sheffler, executive director, Del Prince Marketing, told SN. “We are trying to attack this from the ‘calories in’ side of the equation.

“What we have found is that parents are not teaching cooking in the home the way they used to. The old Norman Rockwell, 1950s-style image of parents teaching their kids to cook so they can do it for themselves in adulthood, is just not happening any more.”


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Ben Del Prince, president of Del Prince Marketing, said the program is designed for companies that don’t necessarily have a dietitian in every store but want to reach more customers with a nutrition-based message. The program is promoted through schools, so that teachers encourage parents to have their children sign up.

Spartan pays Del Prince on a per-store basis for the use of the program, which the supermarket operator can customize to incorporate various store-specific content, such as nutritional store tours or product information.

Customers of Spartan’s Family Fare banner can sign up at www.ctcf.org/familyfare through September. The website will house all the videos as they are released, plus recipes, nutrition education materials, culinary techniques, and “fun food facts,” Reed explained.

More news: Michigan Lauds Angeli, Spartan

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Michigan Lauds Angeli, Spartan

LANSING, Mich. — The Michigan Grocers Association here said Monday it has awarded the inaugural Al Kessel Outstanding Achievement Awards to Fred Angeli of Angeli Foods, and to Spartan Stores.

The awards were created to honor the memory of Al Kessel Jr., who died last year. Kessel was the founder of Kessel Food Markets, with stores in Flint, Saginaw, Bay City and Corunna.


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The 2013 Outstanding Retailer, Fred Angeli, is a third-generation retailer who owns three grocery stores in Menominee and Iron River, Mich., and Marinette, Wis. The Angeli family has been in the food business for 96 years, and Fred has helped grow the company into a successful regional business. He was nominated by Al Kessel’s son James.

The 2013 Outstanding Business Partner is Spartan Stores’ “entire team of associates” as nominated by Bill McDonough of McDonough’s Market on Beaver Island.

The awards will be presented at the MGA Fall Conference and Trade Show on Sept. 15 at Crystal Mountain Resort in Thompsonville, Mich.

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Spartan Evaluates Discount Banner

GRAND RAPIDS, Mich. — While the Valu Land discount chain is still officially in the testing phase, parent company Spartan Stores here said that it has now opened enough locations to determine its fate over the long term.

Spartan operates eight Valu Land stores in a variety of locations serving various demographic customer bases in Michigan, Dennis Eidson, Spartan’s chief executive officer, said during a conference call discussing first-quarter earnings. While the company is still experimenting with the concept, Eidson said “I think we have enough boxes now with an assortment of demographics, [and] different regions of the state to be able to more effectively read this format and determine where we’re going to go long-term.”

Read more: Spartan Reports Q1 Results

Spartan launched Valu Land in early 2012 to test consumer acceptance of a limited-assortment discount store. It’s earliest stores are now in Spartans’ comparable-store sales base, Eidson said, and excluding a week of sales affected by the Easter holiday, comps during Spartan’s first quarter were positive, he said.


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Eidson said the stores differ from Aldi and Save-A-Lot by offering more branded goods and service departments, but emphasized the company is still “tweaking” the concept.

In response to a question from an analyst, Eidson acknowledged that he was “intrigued” by the possibility that the format could be expanded as a result of Spartan’s pending merger with Nash Finch Co. and its largely rural retail store base.

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Spartan Q1 Earnings, Comps Down

GRAND RAPIDS, Mich. — Spartan Stores here on Wednesday said net earnings were down by 22% in the fiscal first quarter resulting in part from impairment charges and from fees associated with its recently announced acquisition of Nash Finch Co.


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For the period ending June 22, Spartan reported net earnings of $ 4.7 million on sales of $ 612.4 million. Total sales increased by 1.4%. Adjusted earnings from continuing operations, which excludes impairment charges and professional fees, increased by 20%, Spartan said, reflecting slightly improved margins and a consolidated sales increase of 1.4%. Sales were negatively affected by the timing of the Easter holiday, which shifted sales to the prior period.

More news: Spartan-Nash Merger Allows Flexibility

Spartan’s retail division saw sales increase 2.4% to $ 353.8 million, resulting mainly from new and acquired stores, and offset by a 2.9% decrease in comparable-store sales. Comps were negatively impacted by the Easter shift and by cycling the launch of a prize freeze initiative and new-store openings last year. Unfavorable weather conditions also affected sales negatively.

Spartan said sales in its distribution segment increased 0.1% to $ 258.6 million.

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Spartan Joins Chorus of Acquisitions

GRAND RAPIDS, Mich. — Spartan Stores here jumped on the merger bandwagon last week with the surprise announcement that it would acquire its much larger wholesale rival, Nash Finch Co., for about $ 1.3 billion. The proposed transaction follows on the heels of Kroger Co.’s bid for Harris Teeter Supermarkets and the Cerberus-led acquisition of Albertsons from Supervalu, plus two mega-deals in Canada that will combine Safeway Canada with Sobeys and Loblaw with Shoppers Drug …

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Spartan Stores and Nash Finch merge

Spartan Stores Inc., a leading regional grocery distributor and retailer, and Nash Finch Co., one of the leading food distribution companies in the United States, have entered into a definitive merger agreement under which Spartan Stores and Nash Finch will combine in an all-stock merger valued at approximately $ 1.3 billion, including existing net debt at each company.

The combination creates a leader in the grocery wholesale, retail and military commissary and exchange channels with pro forma annual sales of approximately $ 7.5 billion. Together, Spartan Stores and Nash Finch will have 22 distribution centers covering 37 states, 177 retail stores and will be the leading distributor to military commissaries and exchanges in the United States.

The combined company will have significant scale and geographic reach to provide value-added distribution services to a diversified customer base and drive new growth opportunities through increased customer penetration, new customer additions and expansion into new market segments. The combined company will also have a comprehensive portfolio of strong private brands including Spartan Stores’ “Spartan’ brand and Nash Finch’s “Our Family” and “Nash Bros. Trading Co.” brands.

Under the terms of the transaction, which has been unanimously approved by the boards of directors of both companies, Nash Finch shareholders will receive a fixed ratio of 1.20 shares of Spartan Stores common stock for each share of Nash Finch common stock they own. Upon closing, which is expected by the end of 2013, Spartan Stores shareholders will own approximately 57.7 percent of the equity of the combined company and Nash Finch shareholders will own approximately 42.3 percent.

“This transformational transaction provides a unique opportunity to bring together Spartan Stores’ grocery distribution and retail operations in Michigan, Indiana and Ohio with Nash Finch’s leading position in grocery distribution to military commissaries and exchanges and its complementary wholesale grocery network throughout the U.S,” said Dennis Eidson, president and chief executive officer of Spartan Stores. “Together, we will create one of the premier grocery wholesaler and retail operators, with a comprehensive portfolio of high-quality private brands, nationwide distribution services and a strong platform for future growth. By combining our resources, expertise and talent we will become a stronger and more efficient organization with an enhanced ability to leverage our size, geographic reach and hybrid business model to better compete in the evolving grocery industry. In addition, the scale of the combined company will provide efficiencies and savings in purchasing and strengthen our ability to serve our independent retail customers, military commissaries and exchanges and retail consumers. At the same time, the combined company will have greater financial flexibility to drive growth, which will provide opportunities for many employees and deliver increased value to shareholders.”

Alec Covington, president and CEO of Nash Finch, said, “This transaction is consistent with our vision to become the largest and most admired food distributor in the U.S. The complementary operations and outstanding strategic fit of these two companies create significant value for both companies’ shareholders. Our shared vision to provide best-in-class services to our wholesale customers and attractive formats for our retail consumers, as well as our continued commitment to serving our nation’s military heroes and their families, at home and abroad, creates a powerful platform for growth over the long term. In addition, Spartan Stores and Nash Finch share a common culture and passion for integrity, teamwork, innovation and dedication to the customers we serve.”

Eidson will serve as president and CEO of the combined company. Covington will remain with the combined organization in an advisory role to help ensure a smooth transition. The combined company, which will retain a presence in both Minneapolis and Grand Rapids, MI, will include members of each company’s experienced management teams and employee bases. Nash Finch’s military business will continue to conduct its operations as it has in the past and will remain based in Norfolk, VA. Edward Brunot, who currently serves as president of Nash Finch’s military business, will continue to lead that business in the combined organization. Craig Sturken, chairman of Spartan Stores’ board of directors, will serve as chairman of the board of directors of the combined company, which will be comprised of 12 members, with seven being designated by Spartan Stores and five being designated by Nash Finch.

The combined company is expected to achieve approximately $ 50 million in annual cost synergies by the third full fiscal year of operations, primarily derived from the consolidation of corporate functions, procurement and other operating efficiencies. Including these synergies, the transaction is expected to be accretive to earnings per share, excluding one-time costs, within the first full fiscal year of operations, enabling shareholders of both companies to share in the upside potential of the combined organization. The combined company also expects to consistently continue to return value to shareholders through a dividend which will initially be set at $ 0.48 per share on an annualized basis.

The transaction is subject to customary regulatory approvals and closing conditions, including the approval of Spartan Stores and Nash Finch shareholders. Moelis & Co. LLC acted as Spartan Stores’ financial advisor. Warner Norcross & Judd LLP acted as Spartan Stores’ legal counsel and Skadden, Arps, Slate, Meagher & Flom LLP acted as counsel for Spartan Stores’ board of directors. Nash Finch’s financial advisor was J.P. Morgan Securities Inc. LLC and its legal advisor was Morgan, Lewis & Bockius LLP.

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Spartan, Nash Finch to Merge

GRAND RAPIDS, Mich. — Spartan Stores here and Nash Finch Co. said Monday they have agreed to merge in an all-stock transaction valued at $ 1.3 billion.

Together, Spartan Stores and Minneapolis-based Nash Finch will have 22 distribution centers serving 37 states, will operate177 retail stores and will be the leading distributor to military commissaries and exchanges in the United States. They will have combined pro forma annual sales of about $ 7.5 billion.


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Under the terms of the transaction, which has been unanimously approved by the boards of directors of both companies, Nash Finch shareholders will receive a fixed ratio of 1.2 shares of Spartan Stores common stock for each share of Nash Finch common stock they own. Upon closing, which is expected by the end of calendar 2013, Spartan Stores shareholders will own approximately 57.7% of the equity of the combined company, and Nash Finch shareholders will own approximately 42.3%.

“This transformational transaction provides a unique opportunity to bring together Spartan Stores’ grocery distribution and retail operations in Michigan, Indiana and Ohio with Nash Finch’s leading position in grocery distribution to military commissaries and exchanges and its complementary wholesale grocery network throughout the U.S.,” said Dennis Eidson, president and chief executive officer of Spartan Stores.

Eidson will remain president and CEO of the combined companies. Alec Covington, president and CEO of Nash Finch, will remain in an advisory capacity. The combined company, which will retain a presence in both Minneapolis and Grand Rapids, will include members of each company’s management teams and employee bases. Nash Finch’s military business will remain based in Norfolk, Va., led by Edward Brunot, president of that division.

Craig Sturken, chairman of Spartan Stores’ board of directors, will be chairman of the board of the combined company.

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