Save A Lot, one of the largest discount grocery chains in the U.S., today announced the latest update to its wholesale model transition with the sale of its 51 company-operated stores in the Tampa, Florida market to Fresh Encounter, a current Save A Lot Retail Partner licensee. Fresh Encounter will continue to operate the stores under the Save A Lot banner.
Today’s announcement builds on the successful completion of a comprehensive recapitalization of the business and significant deleveraging of the Company’s balance sheet in early 2020. The sale of the Tampa stores to Fresh Encounter is part of an ongoing re-licensing program through which Save A Lot intends to transition to a wholesale model by selling more than 300 corporate-operated locations to new and existing Retail Partners who will continue to operate the stores under the Save A Lot banner. The Company will continue to operate 21 corporate stores locally in St. Louis, where it will continue to develop and launch new innovations as a testing ground to help its retail partners succeed in their individual communities across the country.
“We are excited to expand our partnership with Michael Needler and the Fresh Encounter team, who have been fantastic partners, strong operators and excellent ambassadors of the Save A Lot brand,” said Kenneth McGrath, Chief Executive Officer at Save A Lot. “Through the re-licensing transactions we are executing across our footprint, we believe that we will be even better positioned to continue to serve the communities in which we operate. We currently have a dedicated group of retail partners that we support and we look forward to helping other entrepreneurs own, operate and succeed in their own business.”
To date, Save A Lot has executed seven sale transactions, comprising 82 stores, including those being sold to Fresh Encounter. As multiple sale transactions near completion, the company expects to complete its re-licensing program in 2021. With 1,000 stores in 33 states and 14 wholesale distribution centers, Save A Lot serves as a licensor and wholesale partner to over 200 independent owners and operators, who have the flexibility necessary to respond to the needs of each community they serve. Through an emphasis on serving and supporting its retail partners, Save A Lot has built a sustainable, high-growth and community-focused business, while remaining true to its mission of adding unmatched value to its local communities. Owners are able to customize their assortment to cater to the tastes and preferences of their local customers.
“The Fresh Encounter family of companies has a culture that prioritizes being positive, appreciative and resilient and we are eager to onboard the new Florida associates. Over the past several months I have toured stores in the greater Tampa market and I’m impressed with the Save A Lot team,” said Michael Needler, Jr. President and Chief Executive Officer, Fresh Encounter, Inc. “I am truly humbled to be joining them in delighting our customers, nourishing the communities and inspiring pride in the team. Kenneth and Kevin Proctor and the rest of the Save A Lot corporate team are transformative and we are equally eager to join their efforts in re-establishing the Save A Lot brand for tomorrow’s competitive environment.”
PJ Solomon served as financial advisor and Troutman Pepper served as legal counsel to Save A Lot in connection with the transaction.
