LEWISTON – Wal-Mart’s sale of its distribution subsidiaries will have zero impact on the facility planned here, a company spokeswoman said Tuesday.
“All systems are go in Lewiston,” said Mia Mastan, community affairs manager for the world’s largest retailer. “Everything is still on schedule.”
That is welcome news for the Twin Cities’ business community. A series of delays pushed back construction on the 485,000-square-foot food distribution center, which is expected to employ about 350 people upon opening in August 2005.
Wal-Mart Stores Inc. announced Friday that it is selling one of its subsidiaries, McLane Co., to Berkshire Hathaway Inc. – a holding company run by Warren Buffett – for close to $1.5 billion. McLane employs 14,500 workers and distributes merchandise to Wal-Mart and Sam’s Club stores.
The retail giant also announced plans to sell Merit Distribution Services to Swift Transportation Co. for $50 million. Wal-Mart officials say the sales will allow them to focus on core retail operations.
Wal-Mart, however, retains its own massive distribution network. That includes 7,000 drivers, tractors and more than 100 warehouses like the one planned for Lewiston. Five other food distribution centers are expected to open this year, Mastan said.
Brief press reports of the McLane transaction prompted some to think that Wal-Mart was selling off its entire distribution network.
“I had a couple of inquiries where people were led to believe this was more than it is,” said Greg Mitchell, Lewiston development director. Mitchell made a follow-up call with Wal-Mart, just to be sure. He was told there had been no changes in schedule.
“The announcement was a little confusing,” he said. “We have agreements in place with them that provide for full protection for us to proceed.”
Work on the center – to be built along the Plourde Parkway – was originally scheduled to begin a month ago and conclude in April 2004. A six-month delay was then attributed to design changes. And a general economic slump was blamed for the yearlong delay announced last month.
“We’re not opening new stores as quickly as we planned,” Mastan told the Sun Journal. “The distribution centers we have in place can serve the existing stores adequately.”
Upon completion, the new facility in Lewiston will be the second New England grocery warehouse, serving supercenters throughout the region. Another center is located in Raymond, N.H.
Analysts say McLane Co. became expendable as Wal-Mart expanded its own distribution system. The company only had three supercenters – combination discount stores and groceries – when it purchased McLane in 1990. Wal-Mart now boasts 1,288 supercenters and about 50 stand-alone groceries.
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