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Ahold announced yesterday that it is putting up for sale 46 Tops stores in Ohio – in Cleveland, Akron, Youngstown and Norwalk – that it says are both underperforming and no longer part of its core market area. The company has retained William Blair & Company to coordinate discussions with potential buyers.

The decision follows Ahold’s sale of Bi-Lo and Bruno’s last year, and consistent rumors that under the right circumstances the entire company – or at least its US divisions – could be sold. However, company officials said yesterday that this was an isolated decision.

The Washington Post notes this morning that “Ahold has been struggling with uneven performance at its US operations. The company said it is conducting a review of its weaker divisions and plans to issue a complete report in the fall.

As also reported by the Post, “Ahold acquired the Ohio stores, then called Finast Supermarkets, in 1988. The company merged them with its existing Tops supermarkets in 1996 and changed their name three years later. The chain is part of Ahold's Giant-Carlisle division, which is based in Pennsylvania and includes a separate chain of Giant stores and Martin's Super Food Stores.”

It was just about a month ago that it was reported on MNB and elsewhere that a number of hedge funds were building up their holdings in Ahold, with a possible goal of breaking up of the company. While the strategy was said to be its preliminary stages, the goal was to amass a large enough stake in the company that it can catalyze management to try and maximize shareholders’ investments. Among the options are selling off the company, and splitting its three businesses – US retail, US foodservice, and European retail – into three separate companies. Reports are that the hedge funds believe that the three businesses have few if any synergies and would be more effective and profitable if separated.
KC's View:
One has to wonder if this is the beginning of a much larger divestiture for Ahold. CEO Anders Moberg said at the CIES Summit that he doesn’t pay attention to all the rumors about selling the company…but he didn’t exactly deny that it isn’t at least a possibility.