Canadian “natural” food retailer Planet Organic has shed its vitamin manufacturing division and half a dozen health food stores to help pay down debt.
The Edmonton-based company, which operates nine Planet Organic natural food supermarkets across Canada and 11 Mrs. Green’s supermarkets in the U.S., said Wednesday it’s sealed a deal to sell its supplement and vitamin division, Trophic Canada, for $10.6 million.
The buyer, Quebec City-based nutritional supplement maker Atrium Innovations, “will be a great partner to Trophic in providing them support to grow their business,” Planet Organic executive vice-president Darren Krissie said in a release.
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Planet Organic has previously billed its Trophic wing as “the country’s leading manufacturer of natural supplements.”
Planet Organic on Wednesday also wrapped up the sale of its six Healthy’s stores in southern Ontario to Good Health Mart, a chain of health food and supplement stores in the same region, for an undisclosed sum.
However, Planet Organic said Wednesday, it “remains in default under its credit facilities” and hasn’t yet been able to arrange financing elsewhere to meet its debt obligations.
The company thus is still “reviewing all financing options in order to eliminate its aggregate debt load.”
The sales follow Planet Organic’s deal, concluded in late February, to sell its Saskatoon-based chain of 43 Sangster’s Health Centre stores to an unnamed buyer for an undisclosed sum. The company announced plans the previous November to close one of its Planet Organic supermarkets at Vaughn, northwest of Toronto.
The beleaguered company last week announced four of its board members, including Michael Arougheti, Daniel Katz and David Heighington and former Planet Organic Market division president Mark Craft, had resigned, with Krissie and two other board members remaining.
One of the remaining directors, Brent Knudsen, is a principal with Partnership Capital Group, which acted as Planet Organic’s “exclusive financial advisor,” and will get a transaction fee, on the sale of Trophic to Atrium.
Planet Organic on March 1 reported a net loss of $2.16 million on $28.15 million in sales in its second fiscal quarter, down from a $2.8 million loss on $28.74 million in sales in the year-earlier period.
