Four Sterk's stores changing hands

Other locations could be next
2007-02-17T00:00:00Z Four Sterk's stores changing handsANDREA HOLECEK
holecek@nwitimes.com
219.933.3316
nwitimes.com
February 17, 2007 12:00 am  • 

Two Sterk's Super Foods stores in Indiana and two in Illinois will be under new ownership and begin carrying different house brands by the end of February.

The Food Club Inc., in Chicago Ridge, is buying the stores at 2121 Columbus Drive, East Chicago; 6529 Columbia Ave., Hammond, and One Sauk Plaza, Sauk Village. The stores will retain the Sterk's name, said Sterk's President Joe Kolavo.

"They will continue running under the Sterk's banner," Kolavo said Friday. "There will be very little disruption for customers or employees. The new owner wants to continue operating them as they are."

However, the stores will change their in-house brands from Centrella, which is distributed by Central Grocers Inc., to the labels of their new supplier, Certified Grocers Midwest Inc. of Hodgkins, Ill., Kolavo said.

Buy-N-Save Inc., of Chicago, is buying the Sterk's store at 22240 Governors Highway, Richton Park, which adds a third store to its holdings. The name will change to reflect its new ownership, and the stores also will switch to private-label brands distributed by Certified, which supplies the other Buy-N-Save stores.

Officials from neither The Food Club nor Buy-N-Save returned calls for comment Friday.

Hammond-based Sterk's also has a agreement in place to sell its store in Lockport, Ill., to Fairway Finer Foods, but no closing date for the purchase has been set, Kolavo said.

"We hope to get it done as soon as possible," he said.

The fate of the chain's other four stores, which are in Calumet City, East Chicago, Munster and Park Forest, is unclear. There have been discussions with potential buyers, but no deals are currently in the works, Kolavo said.

"If we're contacted by someone interested in talking to us about our other locations, we're interested in talking to them," he said. "There's been a lot speculation and talk. It's hard for us because our policy is unless we have something to report, there's nothing to report."

Franklin Park-based Central Grocers Inc. owns 100 percent of the stock in Sterk's, but the chain is independently operated. In 2000, the grocery cooperative bought the shares of Sterk's corporate stock held by Dick Sterk, the son of the chain's founder.

The remainder of the chain's stock, which totalled slightly more than 50 percent, was owned by a Employee Stock Ownership Plan until Central purchased it at the end of 2005.

"We're diversifying ourselves of our underperforming stores," said Jim Denges, vice president-assistant general manager of Central Grocers. "The deal should be completed by (Tuesday), but that could change."

Central Grocers also owns 100 percent of the Strack & Van Til's corporation and supplies groceries to the 11 stores operated under the Strack's name and the 11 run under the chain's Ultra Foods banner. Plus Central Grocers supplies its Centrella-brand private label products to the other members of the co-op, including WiseWay Super Foods and Walt's Finer Foods.

Seventy percent of Central's volume supplies stores in Indiana and the south suburbs of Chicago, Denges said.

Although the sale of the four Sterk's stores will reduce that volume by about 4 percent, the wholesaler is adding 15 percent to its volume by supplying new store locations which had been operated by Cub Foods, he said.

In a multi-million dollar deal announced in October, Highland-based Strack's bought former Cub Foods locations in Joliet, Hanover Park, Lombard, Plainfield, Downers Grove, Wheaton and Chicago. The first three listed recently opened as Ultra Foods stores, Denges said. The others will carry either the Strack's or Ultra name.

"Another of our members bought other Cubs locations," Denges said. "Garden Fresh is opening four stores in the northern suburbs. There's a lot of activity here because we're essentially doing a good job."

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