The new owner of two Rainbow Foods stores has decided to close them, four months after picking them up in a multicompany, 27-store deal that reshaped the Twin Cities grocery scene.
Jerry's Enterprises Inc. notified workers and city officials that it will close the stores at 1660 S. Robert St. in West St. Paul and 2919 26th Av. S. in Minneapolis in early November.
Both stores employ about 25 full-time workers and another 60 or so part-timers.
Jerry's, an Edina-based operator of about 40 stores in Minnesota and Florida, owns other grocery stores under the Cub Foods name next to both locations. A spokesman for Jerry's confirmed the decision but declined to comment further.
The company picked up the two stores and one other in a complex deal in May triggered by the decision of Milwaukee-based Roundy's Inc., owner of Rainbow Foods, to exit the Twin Cities market.
Roundy's sold 18 of 27 stores to a consortium led by Supervalu Inc., the giant wholesaler and grocery operator based in Eden Prairie. The consortium included Jerry's, which operates stores under its own name and as a franchisee of Supervalu's Cub Foods grocery line. It kept the Rainbow name on the three stores it acquired.
On Tuesday, Jerry's told workers and local officials that it would close the two that are near to its Cub stores.
Matt Utecht, president of United Food and Commercial Workers Local 653, which represents west-metro grocery story workers, said he was surprised Jerry's made the decision so soon after acquiring the properties.
"A couple of years down the road, if it didn't work out, I wouldn't be shocked. But 60 days after they bought it?" Utecht said. "It's extremely disappointing, especially to the people working in the stores. They were told by Jerry's, 'We're taking you guys on and you're getting a fresh start.'"
Jim Hartshorn, economic development director for the city of West St. Paul, said officials had known there was a possibility that the store would be closed because Jerry's owned the Cub store nearby.
"We're sorry to see them go, but it affords us an opportunity to seek something new there," Hartshorn said.
Developers have been called over the last few months because they knew Jerry's had competing stores as a result of the May deal and the 4.75-acre site is one of the few of any size available in West St. Paul. "We feel pretty confident we'll get someone new there," Hartshorn said.
Staff writer Mike Hughlett contributed to this report.