Sam Duncan, the veteran retail executive who has led Supervalu Inc. back from the brink, will retire in February, three years after he became the company's CEO.

Duncan, 63, took over after an embattled Supervalu had sold its four main grocery chains for $3.3 billion, a move that halved the size of the company.

Since then, Eden Prairie-based Supervalu has regained some momentum, as Duncan cut costs, lowered prices at Supervalu-owned supermarkets and decentralized its grocery store management. Those cost reductions included 1,000 corporate job cuts in 2013, 600 of them in Minnesota.

Supervalu's stock was just under $4 when Duncan took over and rose to a high of about $12 in April, though it has fallen since, closing Thursday at $7.03, down 15 cents. The news was announced after the market closed.

Supervalu's board of directors "is in the selection process for naming a new CEO" and is looking at both internal and external candidates, said Jeff Swanson, a company spokesman.

The company also announced Thursday that Bruce Besanko, Supervalu's chief financial officer, has been promoted to the newly created position of chief operating officer. In many companies, the chief operating post is a steppingstone to the CEO suite.

Susan Grafton, Supervalu's chief accounting officer, has been promoted to chief financial officer, and will report to Besanko.

Duncan helped "stabilize" Supervalu, Jerry Storch, chairman of Supervalu's board, said in a press statement. He "has led a turnaround in the performance of the entire company, including improving the performance of all three of its core business segments."

The sale of Supervalu's major supermarket chains left the company as more of a grocery distributor, with just over half its sales generated by wholesaling. Supervalu's national, low-discount supermarket chain, Save-A-Lot, and its remaining regional supermarket banners — including Cub Foods in the Twin Cities — each compose about one-quarter of the company's roughly $18 billion in annual sales.

Supervalu's annual sales rose 3.5 percent for its fiscal year ending Feb. 28, after being flat the previous year. The company has improved its profitability in its past two fiscal years, after losing money in the year just before Duncan's arrival.

In July, Supervalu announced it might spin off Save-A-Lot, a relatively fast-growing property in the slow-growth grocery business.

Before the Supervalu gig, Duncan had been OfficeMax's CEO, retiring in 2011. He had also spent many years in the grocery business, moving up the ladder at Albertsons before joining the Fred Meyer chain.

"After 46 years in the grocery and retail business, this is a bittersweet moment, but I am also excited by the opportunity to have more time for my family and personal interests following retirement," Duncan said in a prepared statement.

In July 2013, Duncan hired Besanko, who had been chief financial officer at Duncan's old employer, suburban Chicago-based OfficeMax, which was bought by Office Depot later that year.

Mike Hughlett • 612-673-7003