Newswatch 2009-11-16 (2)

WINN-DIXIE INVESTORS SEEK BUYBACK

JACKSONVILLE, Fla. — A group of Winn-Dixie shareholders last week asked the company to buy back shares of its stock to increase the share price, or else look for an investor to buy the company outright. Schultze Asset Management, which said it serves as investment advisor to various shareholders owning 1.5% of the common stock of Winn-Dixie Stores, recommended that the company use available cash and issue additional debt to buy back $590 million worth of its stock, rather than using cash to fund store renovations. Alternatively, Winn-Dixie should “hire a reputable investment bank to help explore a sale of the entire enterprise at a fair price,” the group said. Winn-Dixie was not available for comment.

ALBERTSONS INVESTOR PLEADS GUILTY

NEW YORK — A banker who executed trades against confidential information that Albertsons would be sold pleaded guilty to charges of conspiracy and securities fraud, federal investigators here said last week. According to the U.S. Attorney's Office, Michael Koulouroudis executed trades on tips provided to him by Nicos Stephanou, an investment banker at UBS who represented a private equity firm that was interested in acquiring Albertsons in 2005 and 2006. Koulouroudis faces up to five years in prison on conspiracy charges and up to 20 years on security fraud. Stephanou in May pleaded guilty to seven charges of distributing tips to friends and associates including Joseph Contorinis, a former money manager for the Jefferies Paragon Fund, who was indicted by a federal grand jury on fraud charges earlier this month. Two other associates of Stephanou have also been charged.

TARGET OPENS ‘P-FRESH’ IN TEXAS

MINNEAPOLIS — Target Corp. here has begun rolling out its “p-fresh” grocery model in Texas, according to local reports. P-fresh, or prototype-fresh, adds grocery departments resembling that of a SuperTarget location to existing Target discount stores. The concept started in Minneapolis and more recently was rolled out in Philadelphia. According to NBC News in Dallas, a prototype p-fresh store in Dallas will serve as a model for 14 additional locations planned for North Texas.

UNIFIED REFINANCES FOR LIQUIDITY

LOS ANGELES — Unified Grocers here said last week it has closed a transaction to borrow an additional $25 million from John Hancock Life Insurance Co., Boston. The funds will be used to pay down Unified's line of credit and maintain its balance sheet, Al Plamann, president and chief executive officer, said. “We feel it is also critically important to garner as much liquidity as possible, particularly in these difficult economic times,” he said. The new debt consists of 10-year fixed-rate senior secured notes at 6.82%.

ARDEN COMPS FALL 9.1% IN Q3

LOS ANGELES — Arden Group, parent company of Gelson's Markets, Encino, Calif., said it is implementing new marketing programs to retain and attract customers in the face of increased competition that helped drive a sharp decline in sales in the third quarter. However, the company, which operates 18 upscale Gelson's stores, was not specific. Net income for the 13-week quarter, which ended Oct. 3, rose 13.5% to $4.7 million — due primarily to a significant reduction in expenses related to stock appreciation rights, the company noted — while sales fell 9.1% to $103.8 million, and comparable-store sales also fell 9.1%.