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Tuesday, September 14, 1999
By KEVIN SWEENEY Journal Editor NEW ULM -- Two New Ulm grocery store competitors will become part of the same company soon, according to Coborn's Inc. of St. Cloud. Coborn's, owner of the Cash Wise Store in New Ulm, announced Monday it is acquiring three Randall food stores, including the New Ulm store, from Supervalu, and converting three Cash Wise supermarkets into Cub Foods stores. Under the terms of the agreement, which will be completed in the next few months, Coborn's will acquire the Randall stores in New Ulm, Mitchell, S.D. and Huron, S.D. They will convert existing Cash Wise stores in Owatonna and Mason City, Iowa, into Cub Foods stores. In addition Coborn's will close its Hutchinson Cash Wise store and become the owner/operator of the newly constructed Cub Foods store that will open later this fall in Hutchinson. "We are pleased to enter into a relationship with another organization known as a leader in the foods industry," said Coborn's CEO Don Wetter. "The acquisition of stores in South Dakota and the inclusion of Cub Foods stores into the Coborn's family of stores align with our objective of continued growth through market expansion and product development." The New Ulm Cash Wise and Randall's will continue to operate as they are now for several months. Wetter said the company plans to operate both stores for now and evaluate the market before deciding on the ultimate outcome of the stores. One possibility is that the two stores would be consolidated into one operation, which would be a Cub Foods store. Wetter said that scenario was possible, but the company has not made a commitment to consolidation. Cub Foods was developed by Supervalu, and the corporation owns some stores while others are privately-owned franchises. The Coborn's-owned Cub Foods stores would be franchises of Cub Foods. Supervalu will be the supplier of those stores, said Wetter. The Randall Value Center in New Ulm has been owned by Supervalu, the nation's largest food distributor, since last fall, when it was acquired from the family owned Randall Foods in Mankato. Madsen's originally came to New Ulm in 1960, part of a chain owned by Earl Madsen. The current store was built in 1973 and opened in 1974 as a Madsen's Value Center. It was purchased by the Randall family in the mid 1970s after Earl Madsen's death. Randall's manager Dick Ginn has worked at the store since his high school days. He sees the sale as a return to family-owned traditions of Madsen's and Randall's. "For our people, it's good to know finally which direction we are headed. We haven't known that since last year (when Supervalu acquired the stores)." Coborn's is "a family-owned and operated store, like we've been used to," said Ginn. "I think the marriage will be a very good one. Coborn's is a very community oriented organization, much like the Randall family." Brad Johannes, manager at Cash Wise, said the acquisition will give New Ulm customers an opportunity to receive some new services. Whatever Coborn's decides to do with the stores, there is likely to be a major development or remodeling that will allow the addition of some "cutting edge" grocery services one would expect to find in larger cities. The three Randall stores being acquired by Coborn's employ about 450 people. Coborn's expects to maintain Randall's current qualified employees, Wetter said. Supervalu is the nation's largest food distributor to supermarkets and the 10th largest supermarket retailer. Coborn's will join more than 500 retail food stores supplied by Supervalu's northern region from its distribution centers in Minneapolis, Des Moines, Iowa, and Bismarck and Fargo, N.D. Coborn's Inc. employs 4,100 people in stores throughout a three-state market area, including 13 Coborn's supermarkets, 10 Cash Wise Food stores, 15 Little Duke's convenience stores, 15 off-sale liquor stores and 18 pharmacies. The company is headquartered in St. Cloud and supports facilities for central administration, bakery, foods and floral operations.
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