Kroger Co. (NYSE: KR) filed a disclosure Thursday with the U.S. Securities and Exchange Commission that indicates the grocery giant does “not expect any incremental impact on adjusted EPS guidance for fiscal years 2019 or 2020 as a result” of the ongoing Lucky’s Market bankruptcy.
Kroger is offloading its 55 percent stake in the Boulder-born Lucky’s, which is in the process of closing dozens of locations across the country.
“Given this decision to divest, we recognized an impairment charge of $238 million in the third quarter of 2019. The portion of this charge attributable to Kroger was $131 million,” the SEC disclosure said.
In September 2016, Kroger provided Lucky’s with a secured loan of $23,328,810. A second agreement for a new $25,177,640 loan was struck in August 2017. Later that year, the parties “entered into agreements subsequently to, among other things, lend [Lucky’s] additional amounts over time,” according to Lucky’s bankruptcy documents. By the time Lucky’s filed for bankruptcy earlier this month, the loan balance was $301,156,450.
Thursday’s SEC filing was “in response to investor inquiries regarding the Lucky’s Market decision to commence a voluntary proceeding in the Delaware bankruptcy court,” the disclosure said.
Kroger’s stock price was up slightly Thursday.