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The Indianapolis Business Journal reports that Sun Capital Partners has decided to pull Marsh Supermarkets off the sales block after months of being unable to find a buyer at a reported asking price of between $130 million and $150 million.

According to the story, “Sun has cleaned up the chain’s balance sheet, spruced up dozens of stores, and tweaked the product mix since it paid $88 million in cash and assumed $237 million in debt to acquire Marsh in September 2006. But none of the moves has boosted Marsh’s market share in Indianapolis, where it still lags both Walmart and Kroger ... Since the private equity firm took over Marsh, it has slashed $70 million in overhead, sold $80 million in real estate, and spun off non-grocery businesses ... Marsh used the proceeds to pay down most of its debt and plow $60 million into the renovation of the majority of its stores.”

In an email to the Journal, the company said that “Sun Capital Partners is not currently pursuing a sale of Marsh Supermarkets, nor do they expect to do so in the near future ... We are committed to growing the company by actively pursuing new store sites and add-on acquisitions while continuing with our remodel schedule for existing locations.”
KC's View:
No surprise that a sale did not work out. People simply aren’t spending money, and certainly not on businesses that seem to be at a competitive disadvantage.

It is hard to be comfortable in your own house if you know that there is a “for sale” sign on the front lawn. Marsh still has competitive issues to deal with, but maybe taking the company off the market will be a good thing in the long term.