Stater Bros. set to issue $275 million in bonds
Colton-based grocery chain owner Stater Bros. Holdings Inc. announced plans Monday to issue $275 million in bonds.
The firm, which recently signed a labor deal with unions ahead of upcoming negotiations with other major chains, said in a release that the $175 million of raised capital would go to paying down bond debt and nearly $100 million would help to finance construction of a new distribution center in Southern California.
An additional $15 million would go toward buying back common stock and $5 million would be used to pay a dividend to the company's sole shareholder, Colton-based La Cadena Investments.
Jack Brown, Stater Bros. Holdings Inc. chairman and chief executive officer, is the sole owner of La Cadena Investments. Despite company executives claiming last year that no dividend to La Cadena was planned for this year, according to the Riverside Press Enterprise, this is the second paid out in as many years.
The firm, which operates 162 grocery stores in Southern California, is seeking to modernize the company's distribution, cut costs, and consolidate eight area facilities by building the new 2.5 million-square-foot center. Located about 60 miles east of Los Angeles in San Bernardino, the new center will house offices and warehousing. Costs for the center have swelled from just over $200 million at the groundbreaking in early 2005 to more than $295 million today. The center is expected to be complete in the summer of 2008.
Stater Bros. set to issue $275 million in bonds
