MILWAUKEE - Roundy's Inc. announced Wednesday that the company has entered into agreements to sell 18 Rainbow stores across the Twin Cities, a move that signal's Roundy's intention to leave the greater Minneapolis-St. Paul market.
Buyers include Twin Cities-based Supervalu and Lund Food Holdings, Inc.
Roundy's says the total sale price for the 18 Rainbow stores is approximately $65 million in cash plus proceeds from inventory in those stores. Buyers will assume leases and certain multi-employer pension liabilities.
The company is also actively seeking buyers for its remaining nine Rainbow stores. Those that cannot be sold are expected to close, and Roundy's will leave the Twin Cities market.
"The economic downturn over the last few years, coupled with an increased competitive footprint in the Minneapolis/St. Paul Market, has made it difficult for Roundy's to keep the Rainbow banner competitive," said Roundy's Chairman, President, and Chief Executive Officer, Robert A. Mariano,. "However, we believe the sale of these Rainbow stores to this group of local operators will provide those stores better stewardship in serving their communities in the Minneapolis/St. Paul market going forward.".
Here is the breakdown on the sale, according to the Minneapolis-St. Paul Business Journal.
These 10 Rainbow Foods stores will be converted to Cub Foods stores:
- Chaska – 200 Pioneer Trail
- Eagan -- 1276 Town Centre Drive
- Lakeville – 17756 Kenwood Trail
- Minneapolis (Lagoon) – 1104 Lagoon Avenue
- Minneapolis (Quarry) – 1540 New Brighton Road
- Oakdale – 7053 10th St. N.
- Plymouth – 10200 Sixth Ave. N.
- Roseville (includes stand-alone liquor store) – 1201 Larpenteur Ave.
- St. Louis Park (includes stand-alone liquor store) – 5370 16th St.
- W.St. Paul – 892 Arcade St.
These two Rainbow stores will become Byerly's (a Lund Food Holdings brand):
- Eden Prairie – 970 Prairie Center Drive
- Woodbury (includes stand-alone liquor store) – 7050 Valley Creek Plaza
Lund Food Holdings, Inc. announced Wednesday that the stores the company is purchasing are located in Woodbury, Eden Prairie and Plymouth. The deal is expected to be finalized within the next 60 to 90 days.
When the purchase becomes official the Rainbow in Woodbury, which includes an adjacent liquor store, and the Rainbow in Eden Prairie, which features an in-store pharmacy, will be converted to Byerly's stores.
The Rainbow in Plymouth (16705 County Road 24) will continue to be operated as a Rainbow for the foreseeable future.
Lunds says that all of the approximately 250 current employees at these Rainbow locations will have the opportunity to continue their employment with Lund Food Holdings.
"We're committed to growth and development for the benefit of our team and customers in the communities we'll be serving," said Tres Lund, president and CEO of Lund Food Holdings. "We're deeply excited to have the opportunity to bring our brand of quality, service and expertise to these communities."
Extensive remodels are expected at the Woodbury and Eden Prairie locations in 2015.
For more information here is the Roundy's press release.