Supervalu To Sell Save-A-Lot Business For $1.365 Billion In Cash

Supervalu Inc. said Monday it has agreed to sell its Save-A-Lot business to private-equity firm Onex Corp. for $1.365 billion in cash. The supermarket chain said it expects the deal to close by Jan. 31, 2017. It will use the proceeds of the deal to pay at least $750 million of its outstanding term loan balance and use the rest to further reduce debt and improve its capital structure, as well as to fund corporate and growth initiatives. The company will enter into a five-year professional services agreement with Save-A-Lot as part of the sale. Shares rose 0.8% premarket, but are down 26% in the year so far, while the S&P 500 has gained 4%.