SUPERVALU Enters Into An Agreement With AFB; Stock Up
Zacks Investment Research | Nov 09, 2016 08:36PM ET
Grocery retailer SUPERVALU Inc. (NYSE:SVU) shares rose 7.8% in the after-trading session following its announcement that it has entered into a long-term supply agreement with grocery retailer America’s Food Basket (AFB). This move is in sync with its strategy to ink supply agreements with other retail giants in an attempt to boost sales.
The company will supply traditional products such as meat, deli, bakery, seafood, grocery, frozen foods and dairy to AFB. Further, SUPERVALU will serve as AFB’s distributor of its Ideal Brands. Additionally, AFB stores will offer SUPERVALU’s private brand products including Essential Everyday, Wild Harvest, and Culinary Circle.
We believe that this is a win-win deal for both the parties as SUPERVALU will gain access to 47 neighborhood stores located primarily in New York and parts of New England where AFB currently operates. On the other hand, AFB’s customers will gain from SUPERVALU’s popular grocery brands like Wild Harvest, Culinary Circle and Essential Everyday.
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