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Winn-Dixie's parent explores sale

Image of Winn Dixie storefront

Photo: John Greim/LightRocket via Getty Images

Southeastern Grocers, the parent of Winn-Dixie, is exploring a sale and holding talks with potential buyers, more than four years after emerging from bankruptcy, the Wall Street Journal reports.

Why it matters: Grocery M&A is heating up following the nearly $25 billion merger deal of Kroger and Albertsons.

Of note: Food retail remains strong, helping drive Walmart's 8.2% comparable sales growth in Q3, an important factor for deal-making in uncertain times.

Flashback: Southeastern Grocers pulled its plans to go public a little more than a year ago after filing for an IPO in late 2020, according to SEC filings.

  • It had already delayed an IPO in late January 2021 "due to a lack of demand at the price range it was targeting," Reuters reported at that time.
  • If the IPO had gone forward at the proposed price range, it would have valued the business at between $950 million and $1.1 billion, including net debt.
  • Selling shareholders, according to an amended S-1 filing, included Fidelity Investments, Osterweis Capital Management, Millstreet Capital Management, LSF7 Bond Holdings, Alliance Bernstein, Deutsche Bank, Amzak Capital and First Eagle Investment Management.

By the numbers: The grocery chain operates 420 supermarkets, 200 pharmacies and 140 liquor stores, per the WSJ.

  • From those businesses, it generates $9.6 billion in revenue.

The intrigue: By putting itself on the block, Southeastern Grocers may be removing itself as a potential bidder for the several hundred stores that Kroger may need to divest.

  • But it may also present an opportunity for a PE firm or another would-be buyer to roll up regional supermarket chains with stores divested by Kroger and Albertsons.

What they're saying: "We do not comment on market rumors. With that said, we are always reviewing ways to enhance shareholder value," the company told Axios.

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