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The Minneapolis Star Tribune reports that the folks at Supervalu are feeling pretty good these days:

• It walked away from a $2.3 billion supply contract with Kmart less than two years ago, thus avoiding the financial quagmire suffered by Fleming when it got the contract and then lost it after Kmart filed for bankruptcy.

• Unlike Fleming, Supervalu has not had to file for bankruptcy protection.

• Unlike both Fleming and another of its competitors, Nash Finch, Supervalu has not been under investigation by the US Securities and Exchange Commission (SEC).

• Supervalu has the opportunity to pick up customers from Fleming, though the company is only expected to do so in markets where it overlaps with Fleming, as opposed to new markets.

“Although still far from its 52-week high of $30 last May, the company's stock price has climbed 27 percent in the past month,” the paper reports.

Supervalu reported fourth quarter net sales of $4.6 billion compared to $4.5 billion last year, and net earnings of $63.9 million compared to $32.8 million last year.

And while the competition suffers, Supervalu has built what is generally believed to be a superior technological infrastructure, which its management believes will be a foundation of a positive future, though the retailing environment remains both challenging and uncertain.
KC's View:
There are folks who’ve told us that based on the Kmart decision alone, Supervalu CEO Jeff Noddle gets the “smartest guy in the industry” prize.

And that’s a logic that’s hard to disagree with.