Future of Inver Grove Heights Rainbow Foods in jeopardy

The Rainbow Foods Location in Inver Grove Heights remains unsold by Roundy’s, Inc. It’s future is uncertain, while 10 other locations have been bought by SuperValu, and will become Cub Foods stores. (Tim Faklis/Review)

Some stores’ll be Cub Foods, others unclaimed

Rainbow Foods is leaving Minnesota, for the most part.

SuperValu, Inc., will purchase 10 Rainbow Foods locations, and turn them into Cub Foods stores. Six locations, including one in West St. Paul, will still be Rainbow Foods, but under new ownership.

For nine locations, including the store in Inver Grove Heights at 9015 Broderick Blvd., the future is unclear. That location has been a major selling point for potential tenants of White Pine Senior Living, a housing complex right across the street.

A buyer is still necessary to ensure that a grocery store will remain there.

Fast transition

For now, the announcement was a fairly complex one, but still exciting for the company, according to SuperValu spokesman Jeff Swanson. He said he hopes for a seamless and quick transition.

“Our plan is to close on the financial transactions of the 18 stores over the next 60 days,” he said. “Once the deal’s done, we will close the stores for a very short period of time, one to two days maximum, mainly to change out the signage and restock shelves.”

While Swanson sees it as too early to discuss remodeling plans, he did mention an eventual aggressive remodel.

The big picture

Roundy’s, Rainbow’s parent company, will sell the Minnesota sites for $65 million. SuperValu’s contribution to that sale totals $35 million, with other companies like Lund Food Holdings, Jerry’s Enterprises, Haug Enterprises and Radermacher Enterprises also getting in on the action.

Of the 18 stores in question, SuperValu will claim complete ownership of three Cub stores, majority ownership of two Cub stores, and minority ownership of three. It’ll have total ownership of two Rainbow stores, as well as total ownership of 11 affiliated pharmacies.

Once the transaction is complete, it’ll bring the total to 77 stores, 76 of which are in Minnesota (one store’s in Illinois).

Swanson and Cub Foods leadership have been meeting with store employees at the 18 stores to discuss upcoming changes. The company will be hiring about 1,000 employees over the next couple months, with a passion for food and customer service being a trait for any candidate. If current Rainbow employees believe they possess those qualities, “we encourage them to apply,” Swanson said.

This includes stores like the one in West St. Paul. While the buyer (Jerry’s Enterprises) is allowing that location to keep its name, current employees will still have to re-apply.

“There’s no guarantees, so of course people are wondering,” said Larry, who identified himself as a West St. Paul Rainbow employee.

Another potential concept could be the Hy-Vee chain, as there’s been discussion of that chain moving toward the Twin Cities.

But Hy-Vee spokesman Chris Friesleben said the possibility of buying up the Rainbow buildings hasn’t been discussed among personnel.

Tim Faklis can be reached at 651-748-7814 or at  tfaklis@lillienews.com.

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