A&P RAISES $203 MILLION IN METRO STOCK SALE
MONTVALE, N.J. — A&P here said last week that it raised about $203.5 million from the sale of stock in Canadian retailer Metro Inc. and will use the proceeds to fund its previously announced acquisition of Pathmark Stores. A&P acquired a 15% ownership stake in Metro as the result of Metro's purchase of A&P's Canadian stores in 2005. A&P said it continues to hold 11.7 million Metro shares, or a stake of about 10.2%.
WHOLE FOODS, WILD OATS RECEIVE FTC INQUIRY
WASHINGTON — The Federal Trade Commission here has asked Wild Oats Markets and Whole Foods Market to provide the agency with information related to their proposed merger. The companies, in documents filed last week, said they expect to respond promptly to the request. Whole Foods, Austin, Texas, said last month it would purchase Boulder, Colo.-based Wild Oats Markets. Observers expect regulators may require the companies to divest some stores to meet antitrust requirements.
ANNUAL EARNINGS UP 17% AT GELSON'S PARENT
LOS ANGELES — Arden Group, the parent of Gelson's Markets here, last week said it earned $23.2 million on sales of $482.7 million for the fiscal year ended Dec. 30. Earnings increased by 17% as compared with 2005, while sales for the year and the fiscal fourth quarter increased by 2.6%, the company said. Comparable-store sales were also up by 2.6% for both the quarter and the year. Sales growth was sparked by pricing decisions and higher customer counts, Arden said. Gross profit as a percent of sales was 38.6% for the year, as compared to 38.4% a year ago.
COUPON PROCESSOR IOS CHARGED WITH FRAUD
MILWAUKEE — The U.S. Attorney's office here has filed charges against International Outsourcing Services, a coupon processing firm, and 11 individuals, accusing them of wire fraud. The 25-count indictment alleges that the scheme caused more than $250 million in losses to manufacturers nationwide. IOS, along with nine of its executives and employees and two individuals from another coupon firm, are accused of submitting fraudulent coupons to manufacturers for payment over a 10-year period from 1997 to 2006. The suit alleges they filed coupons for redemption that had never been redeemed and invoiced coupons to manufacturers as having been redeemed at large retailers when, in fact, “those coupons had been submitted to IOS by smaller stores that were far more likely to have their coupons rejected due to fraud concerns,” the U.S. Attorney's office said. In a prepared statement, IOS said it “has always operated with integrity to ensure that its customers, big and small, are paid fairly for the coupons they accept and that all manufacturers and other business partners are treated fairly.”
SUPERVALU TO LEASE NEW BUILDING FOR ALBERTSONS
MINNEAPOLIS — Supervalu here has signed a five-year lease for additional headquarters space in Eden Prairie, Minn. The 345,000-square-foot space, a previous headquarters for retailer Best Buy, will house merchandising and marketing functions for Supervalu, which has grown since the acquisition of Albertsons assets last year. The retailer plans to include a test kitchen for product and recipe development in the new space.
SAN FRANCISCO EXPANDS PROPOSED BAG BAN
SAN FRANCISCO — The Board of Supervisors here has expanded a proposed ban on plastic bags at supermarkets to include drug stores. The original proposal would have required grocery stores that do more than $2 million in annual sales to offer bags made of recyclable paper, plastic that can be turned into compost, or sturdy cloth or plastic that can be reused. It also included penalties for retailers that fail to comply.