JACKSON, Miss. -- Jitney Jungle Stores of America here stood on the verge of extinction last week after auctioning off 112 of its 137 locations.
The stores were purchased by a variety of buyers, including Winn-Dixie, which agreed to take 68 locations; Bruno's Supermarkets, which is taking 19; Fleming, which agreed to buy 14; Brookshire Grocery Co., which is acquiring four; Albertson's, which is acquiring one; and several independents, who collectively are buying six.
Ron Johnson, chairman and chief executive officer of Jitney, told SN the transfers of the stores will be completed between Jan. 2 and Jan. 23, at which point Jitney will effectively be out of business, although a core group of administrators will remain to formally close out the operation.
Jitney, which has been operating as a debtor-in-possession under Chapter 11 of the U.S. Bankruptcy Code, held the auction in New Orleans Dec. 13. The sales were subsequently approved by the U.S. Bankruptcy Court in New Orleans two days later.
Johnson said Jitney will seek buyers for the remaining 25 stores. Those units will continue to operate for the next few weeks, he said, with the company attempting to sell down the product on the shelves. Whatever product is left will be moved to other stores and the units will be closed, he said.
Jitney also operates dry grocery and perishables distribution centers here totaling 650,000 square feet. Johnson said the company hopes to sell down the product from those facilities and then put them up for sale.
The buyers of the stores and their plans include the following:
Winn-Dixie, Jacksonville, Fla., which had originally expected to purchase 72 stores when a tentative deal was announced early in November. However, it said it gave up four locations -- three in Florida and one in Mississippi -- to win approval from the Federal Trade Commission for the transaction.
Of the 68 stores it is buying, 54 are in Mississippi, 11 are in Alabama and three are in Louisiana, with stores averaging approximately 34,000 square feet. Winn-Dixie said the stores generate approximately $625 million in annual sales.
The company said most of the acquired locations will become part of Winn-Dixie's Louisiana division and will continue to operate under their current banners, which include Jitney Jungle, Jitney Premier, Sack & Save and MegaMarket. Winn-Dixie is also acquiring 32 fuel centers, which will continue to operate under the name Pump & Save.
The company said it will interview all store personnel and plans to retain "substantially all" of the 5,300 retail employees.
Winn-Dixie said it will pay approximately $80.2 million, plus inventory, for the stores. When completed, the transaction is projected to generate additional annualized earnings of 12 to 14 cents per share, beginning in the company's fourth quarter next spring, Winn-Dixie said.
Bruno's, Birmingham, Ala., which acquired two more units than the 17 it said it planned to buy when the tentative deal was announced last month. Of the 19 stores it is buying, 12 are in Alabama, six in Florida and one in Mississippi; also included are five liquor stores in Florida and two gas stations, one in Alabama and one in Mississippi.
Bruno's said it will also purchase the inventory from a Jitney store in Fayette, Ala., that Jitney plans to close.
James A. Demme, president and CEO, said Bruno's will take possession of nine stores on Jan. 2 and the remaining 10 on Jan. 6, with the stores set to reopen under their new banners within four days. All Jitney employees have been offered jobs at Bruno's, he noted.
According to Demme, "Not only does this acquisition enhance our position in core markets, but it also fits with our long-term objectives of strategic growth and continued improvements to existing stores."
Brookshire Grocery Co., Tyler, Texas, which said the four stores it will purchase are located in Louisiana. The company operates 133 stores, including 85 in Texas, 34 in Louisiana (prior to the purchase) and 14 in Arkansas.
Fleming, Dallas, which is acquiring the 14 stores and spinning them off to six independent customers operating in Mississippi, Louisiana and Alabama.
Albertson's, Boise, Idaho, which is acquiring one store in Louisiana.
Rouse's Supermarkets, Thibodaux, La., which is acquiring three stores in the New Orleans area, where it operates its 12 stores.
Autrey Greer & Sons, Mobile, Ala., which is buying three stores in the Mobile area. Greer operates 36 stores in Alabama, Florida and Mississippi.