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Southeastern Grocers (SEG), which operates the Winn-Dixie, Fresco y Más and Harveys supermarket chains, is exploring a possible sale of the company, the Wall Street Journal reports.

The contemplation comes about a year after SEG canceled a planned initial public offering, and in the context of a proposed acquisition of Albertsons, the country's fourth largest grocer, by second-ranked Kroger.  If approved by regulators, a merger of the two companies' operations almost certainly would require the divestment of hundreds of stores.

According to the Journal, "A Southeastern spokeswoman said that the company is always reviewing ways to enhance shareholder value and that it has an obligation to consider transactions that do so. She said the company will remain focused on its strategy."

KC's View:

It seems pretty clear that under the circumstances, Kroger and Albertsons are not going to be making a play for SEG, which probably leaves Ahold Delhaize as a prime possibility - an acquisition would extend its reach to the south, but not west, and would seem to be more consistent with past behavior.  I tend to think that we'll see a private equity group make a play for SEG, on the theory that it could be flipped in a few years once the Kroger-Albertsons deal is concluded.

But I always leave open the possibility for some surprise entrant in the SEG sweepstakes.