Is SuperValu selling or closing Farm Fresh?

UPDATE: The announcement to sell 21 stores was released on March 14. 

Eden Prairie, Minn.-based Supervalu Inc., under pressure from activist investors for “drastic change,” in its business has industry observers wondering what’s happening with its 38-store Farm Fresh division.

The Virginian-Pilot reported on Feb. 27 that employees “fear the worst” as “big changes” are expected at the retailer as early as this week, with insiders saying the retailer is cancelling staff meetings and fiscal reports.

Farm Fresh, based in Virginia Beach, Va., is in the eye of a perfect storm of fierce retail competition, from nearly every channel.

Over the past few years, the region’s gotten new names like Lidl, Aldi, Wegmans and even Publix making its way into North Carolina.

The Virginian-Pilot has a fantastic map showing all of the retail competition surrounding Farm Fresh.

The Packer’s Ashley Nickle reported earlier in February that “activist investors” are pushing Supervalu to break up its wholesale and retail business in an effort to revive flagging stock prices.

The company said in a statement it has had discussions and meetings with investor representatives, but discussions got nowhere.

“Despite our efforts to reach a constructive path forward and to discuss overlapping objectives,” Supervalu said, in a statement,” Blackwells has decided to threaten an unnecessary and counterproductive proxy contest.”

So, stay tuned. I’ll be watching Farm Fresh, and the rest of Supervalu’s retail banners.