DALLAS -- Fleming here said last week it has completed the sale of most of the 36 Furrs Supermarkets it acquired in August to a variety of retail operators -- moves that will add approximately $125 million in distribution revenue to its distribution facility in Lubbock, Texas.
f chains and independents. The buyers are:
Smith's, a division of Kroger Co., Cincinnati, which bought seven.
Food Basket IGA, San Angelo, Texas, six.
Big 8 Supermarkets, El Paso, six.
Pay and Save, a division of Lowe's Food Stores, Littlefield, Texas, five.
Raley's Supermarkets, West Sacramento, Calif., three.
Safeway, Pleasanton, Calif., two.
Lawrence Brothers IGA, Sweetwater, Texas, two.
W&N, Silver City, N.M., two. (The company, owned by Jim Nennich, operates one supermarket and nine Snappy Mart convenience stores.)
Whole Foods Market, Austin, Texas, one.
According to Mark Hansen, chairman and chief executive officer of Fleming, "This is an extremely innovative transaction [that] is representative of the growth opportunities we see nationwide."
A Fleming spokesman said the company is still determining the disposition of a store in El Paso that is currently closed, adding that it could be converted to a corporate Rainbow store. Another store in Las Cruces was closed prior to the sale and will revert back to the landlord when its lease expires in November, he said.
Fleming had initially said it would convert up to 10 of the former Furrs stores to corporate units, "but a combination of the valuations we received from the sale of the stores, plus the acquisition of the five Smith's stores, made us decide not to convert any of the stores to corporate units up to this point," the spokesman told SN.
Furrs has closed the 30 stores Fleming did not buy.
In a separate announcement last week, Fleming said it plans to issue $250 million worth of new 10-year senior subordinated notes in a private placement to refinance existing bank revolver borrowings.
Fleming said the notes will be issued in response to a growth in its business, which has required an increase in short-term borrowings. The company said the growth resulted from new customer growth and acquisitions in the supermarket and convenience-store sectors.
Fleming said it has begun soliciting consents from holders of 10-1/2% senior subordinated notes due 2004, and 10-5/8% senior subordinated notes due 2007, to allow the company to amend the indentures governing those securities so it can issue the new debt.
Fleming said it will make a cash payment of $3.75 per $1,000 principal amount of the notes if the amendments become effective. The solicitation offer will expire Wednesday unless extended.