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ZAANDAM, The Netherlands - Ahold is withdrawing from the South. Late yesterday the financially struggling chain said it intends to divest its Bi-Lo and Bruno's chains. The announcement comes several weeks after the retailer said it would move its U.S. headquarters from Chantilly, Va., to suburban Boston, where its Stop & Shop subsidiary is based.
The intended divestment of Bi-Lo and Bruno's is part of Ahold's strategy to optimize its portfolio and to strengthen its financial position by reducing debt, the company said. Ahold has made a strategic decision to focus its efforts on its remaining U.S. food retail operations, including Stop & Shop, Giant-Landover, Giant-Carlisle, Tops, and Peapod, positioning those companies for growth. Ahold has retained William Blair & Company, LLC to assist in the sale process. Ahold intends to complete the Bi-Lo and Bruno's divestment process in 2004.
Commenting on the announcement, Anders Moberg, Ahold president & c.e.o., said, "We believe that Bi-Lo and Bruno's are both powerful brands and will have a bright future under new ownership. We hope to identify buyers whose strategic priorities include further strengthening these businesses to succeed in a competitive but fast-growing marketplace."
Ahold USA president and c.e.o. Bill Grize commented: "We are confident that this decision will position Bi-Lo and Bruno's for long-term growth in their respective markets, with the intent of creating more value for associates and customers."
Dean Cohagan, president and c.e.o. of Bi-Lo and Bruno's said, "With decades-long heritages of outstanding customer service, deep roots in the communities we serve, experienced management teams and strategically attractive store locations in one of the fastest-growing regions of the United States, Bi-Lo and Bruno's are strong businesses well-positioned to thrive in the years ahead. We are confident that the Bi-Lo and Bruno's tradition of excellence will be continued under new ownership."
Bi-Lo, headquartered in Mauldin, S.C., was acquired by Ahold in 1977 as its first U.S. acquisition. The company operates 292 stores in South Carolina, North Carolina, Georgia and Tennessee, with unaudited net sales in 2003 of $3.2 billion. It employs approximately 27,000 associates.
Bruno's, based in Birmingham, Ala., was acquired by Ahold in 2001. The company operates 178 stores in Alabama, Florida, Georgia and Mississippi, with unaudited net sales in 2003 of $1.8 billion. Bruno's employs approximately 14,500 associates.