Kroger sells convenience stores for $2.15 billion
Kroger (KR) is selling its nearly 800 convenience stores to British operator EG Group for $2.15 billion, the U.S. grocery chain said Monday in a statement. Kroger intends to use proceeds from the sale to repurchase shares and reduce its debt.
In late afternoon trading on Monday, shares of Kroger were down 2 percent, or 60 cents, to $28.72.
The sale is part of the Cincinnati-based company's "Re-stock" strategy of revamping its nearly 2,800 brick-and-mortar supermarkets, reduce prices and increase in-store technology.
Kroger is also investing in online channels as it competes with Walmart (WMT) and Whole Foods, now owned by Amazon (AMZN).
Kroger's convenience-stores unit, which includes brands Tom Thumb, Turkey Hill and Kwik Shop, has yearly revenues of $4 billion. The supermarket gasoline dealers and Turkey Hill Dairy aren't part of the deal.
Monday's announcement follows word from Kroger in October that it was looking for an acquirer for its convenience-store business.