Save A Lot announced that it has secured new financing to recapitalize its business and deleverage its balance sheet. The discount grocer, owned by Canadian private equity firm Onex Corp. since 2016, plans to use the funds to support operations and speed up efforts to modernize its stores.
The agreement calls for Save A Lot to receive $138 million in new capital, while reducing debt by more than $400 million.
Save A Lot has struggled as competition from Aldi, Lidl and Grocery Outlet, among others, has increased. According to Supermarket News estimates, sales for the company fell 9.2% in fiscal 2018-2019 compared to the previous year. In addition, the chain’s store count fell from 1,344 to 1,252 during that time.
Based in Missouri, Save A Lot has been updating St. Louis-area stores and exploring digital technologies in an effort to transform its business model. The company now has a deal with Amazon to make more than a third of its stores pickup and payment sites for Amazon.com purchases.
The new financing deal is expected to be completed sometime before the end of March.