Who Is The Ukrop’s Private Equity Bidder? Not the Likely Suspects

Earlier this week trade publication Supermarket News reported that the auction for Virginia-based supermarket Ukrop’s Super Markets may go to a private equity bidder. Strategic bidders Harris Teeter, Delhaize Group, and Ahold had been outbid by a buyout firm, the publication reported.

The company was first reported to be on the block in July. Goldman Sachs is advising Ukrop’s on the auction, a source told peHUB.

The population of PE shops which would invest in a 28-store grocery company is relatively small. Past investors in the industry include Leonard Green Partners, Wellspring Capital Partners, Willis Stein & Co., Apollo Management, and naturally, Yucaipa Cos., the fund operated by supermarket magnate Ron Burkle.

peHUB has learned that, from our shortlist of logical private equity bidders, Leonard Green Partners, Wellspring Capital Partners, and Willis Stein have not participated in the auction. That leaves Yucaipa Cos. and Apollo Management. However Apollo management, which, in the buyout boom, purchased companies for greater than $5 billion, is likely to consider Ukrop’s below its size range. Meanwhile, the majority of Yucaipa’s investments have been closer to its headquarters in California. So who does that leave?

The company, which had sales of around $590 million last year, has a loyal following in Richmond, Va. It was founded in 1937 and remains under family management. The company is known for not selling alcohol and closing its doors on Sundays.

A Ukrop’s spokesperson was not immediately available to return calls for comment.