The sale of Cub Foods is being pushed back for about two years, its owner said in an earings call Wednesday.
United Natural Foods Inc. (UNFI) bought Minnesota-based SuperValu (the owner of Cub Foods) in October 2018 with the intention of selling off the grocery stores.
That sale was slated to happen sometime this year but with the COVID-19 pandemic, UNFI has decided to put the sale on hold for two years, according to a The Motley Fool transcript of Wednesday's call.
The pandemic has caused a recession and has forced more people to make food at home (a boon for Cub Foods and other grocery stores). Plus, UNFI said it would be "immoral" to sell the stores now, potentially creating a food desert in communities during this time of need, Supermarket News reported.
"We're pleased with the cash being generated by Cub and happy to have the flexibility to sell Cub's owned real estate at a more advantageous time," CFO John Howard said in the call.
Meanwhile, UNFI said that it will spinoff Cub Foods into a separate entity. This is intended to make things easier when it comes time for UNFI to sell the stores.
"As an interim step, we’re in the process of separating Cub from UNFI, which means Cub will operate more as a freestanding entity than it does today, with its own dedicated resources once the separation is complete,” UNFI Chairman and CEO Steven Spinner said in the call.
UNFI stressed it doesn't want to own retail forever, but it'll sell the stores when the time is right.
The company also released its third-quarter results Wednesday, reporting a net sales of nearly $6.7 billion for the 13-week period that ended May 2 – up 12 percent over last year.