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By Bill Freehling

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Report: Ukrop's looking to sell

July 14, 2009 5:04 pm

A report out today in Jeffrey Metzger's Food World magazine says that Richmond-based Ukrop's Super Markets may be looking to sell its chain of 28 stores.

The article puts in writing the rumor that has been circulating for much of this week. Ukrop's spokeswoman Susan Rowe told the FLS that it is the Ukrop's policy "not to comment on rumors."

Metzger said in a brief phone interview today that his report was based on anonymous industry sources. His report says that Ukrop's has issued a prospectus giving its data and seeking interest in a potential sale. His report indicates that Harris Teeter is a frontrunner but points out that it is not a certainty that Ukrop's will be sold at all.

Harris Teeter spokeswoman Jennifer Thompson declined to comment, also saying HT doesn't comment on rumors.

The family-owned Ukrop's opened its first store in Richmond in 1937. Its stores outside the Richmond market -- in Spotsylvania County, Roanoke and Williamsburg -- have reportedly struggled.

Ukrop's and the Ukrop family now own about 60 percent of First Market Bank, which has branches inside many of the chain's stores. But Bowling Green-based Union Bankshares Corp. agreed this year to purchase the bank in a deal valued at about $105 million.

Union Bankshares CEO G. William Beale said yesterday that the merger is expected to close in October. He said he doesn't know anything about a possible Ukrop's sale, but he did say that his bank "considered the risk of a potential sale" when looking into the purchase of First Market Bank. He noted that about two-thirds of First Market's 37 branches are inside Ukrop's stores.

Beale said Union Bankshares learned that the bank leases inside the stores would be upheld even if the grocery chain should be sold. Any potential acquirer of Ukrop's would not be buying any part of the bank.

As for Harris Teeter, the company recently signed a lease on 43,560 square feet of industrial yard space in the Interstate 95 Commerce Center at 9351 Northeast Drive in Spotsylvania. An agent with Thalhimer/Cushman & Wakefield Alliance told me the company plans to use the space for overflow truck parking.

Harris Teeter has also announced plans to build a 500,000-square-foot distribution warehouse in King George County's industrial park. The grocer signed an agreement with the county in January and was given three months to do a feasibility study. Five months have passed, and HT hasn't closed on the property. The company asked for an extension, Cathy Dyson recently reported. 

Harris Teeter is a subsidiary of Charlotte, N.C.-based Ruddick Corp., a publicly traded holding company. HT has been creeping closer to Fredericksburg from Washington of late; it opened a 52,334-square-foot store in Warrenton's Northrock Shopping Center last month.

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Bill Freehling is a business writer for The Free Lance-Star.

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This blog is on Fredericksburg-area business, as well as various topics in investing.