Supervalu Bonds Rise Most Ever After Buyer ‘Interest’ Disclosure

Bonds of Supervalu Inc. (SVU) rose the most since they were issued three years ago after the third- largest U.S. grocery store chain said it’s received a “number of indications of interest” as it conducts a review of strategic options.

The company is in “active dialogue” with several parties, the Eden Prairie, Minnesota-based company said yesterday in a statement. The talks may not lead to any sale, the company said.

Supervalu’s $1 billion of 8 percent bonds have climbed 5.5 cents since Oct. 17 to 89.75 cents on the dollar to yield 11.6 percent at 11:26 a.m. in New York, according to Trace, the bond- price reporting system of the Financial Industry Regulatory Authority. That’s the biggest two-day gain for the securities since they were offered in April 2009, data compiled by Bloomberg show.

The supermarket chain reported sales yesterday that dropped 4.6 percent in its fiscal second quarter, the 14th straight quarterly decline. Supervalu has $3.9 billion of bonds outstanding, Bloomberg data show.

The company has 1,099 traditional retail stores such as Jewel-Osco and Albertsons and has 1,341 Save-A-Lot discount locations.

To contact the reporter on this story: Matt Robinson in New York at Mrobinson55@bloomberg.net.

To contact the editor responsible for this story: Alan Goldstein at agoldstein5@bloomberg.net.

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