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Activist investor to nominate directors to SuperValu's board

Activist investor Blackwells Capital LLC on Feb. 6 told grocery store operator SuperValu Inc. that it plans to nominate three candidates to the company's board of directors as the fund charges that SuperValu's stock performance has lagged competitors.

The activist investor plans to seek seats for three nominees, including managing partner Jason Aintabi, according to a Feb. 6 letter the fund sent to SuperValu. Blackwells said it held meetings with management, including at least one with Nonexecutive Chairman Donald Chappel and President and CEO Mark Gross, in December 2017 and January to discuss "the various points that [Blackwells] believe would stabilize and greatly improve the fragile situation that all SuperValu shareholders know too well."

Blackwells also recommended the grocery store chain spin off its retail division and sell its wholesale unit to a strategic buyer, according to a presentation compiled by the fund.

SuperValu rejected Blackwells' proposed changes at the business, according to the letter.

"We conclude that the board's passivity and the company's persistent underperformance have left us with no alternative but to run an election contest" at SuperValu's annual meeting later in 2018, a move it says will give investors "an opportunity to vote for enhanced board leadership and support a mandate to explore all alternatives to unlock value," Aintabi wrote in the latest letter.

In its own Feb. 7 statement, SuperValu pointed to a recent increase in sales at its wholesale business, among other changes, arguing that the company is already attempting a "rapid transformation."

"Despite our efforts to reach a constructive path forward and to discuss overlapping objectives, Blackwells has decided to threaten an unnecessary and counterproductive proxy contest," the company said.

The investor firm, which owns 4.35% of SuperValu's common stock, had previously written a letter to SuperValu on Oct. 26, 2017, pressuring the supermarket company to sell 30% of its 217 stores and revamp its other outlets in order to stop the decline of its stock value.