business news in context, analysis with attitude

Nice piece in the Minneapolis/St. Paul Business Journal about Supervalu CEO Jeff Noddle, who the magazine has named as its 2008 Executive of the Year. There are lots of interesting tidbits in the piece about Noddle, including:

• “Jeff forever transformed Supervalu Inc. in 2006 when he led the firm's $17.4 billion acquisition of Boise, Idaho-based Albertsons Inc. At the time, the deal was considered the biggest leveraged-buyout ever. It vaulted Supervalu's annual revenue from $19 billion to $44 billion and quadrupled its employee count from 50,000 to 200,000.

“Perhaps as impressive as the deal has been the performance of the merged companies. After many big mergers, companies have to spend years integrating the two businesses and are often too saddled with debt to increase their profits. (But) in just the second full year of the acquisition, the new Supervalu is expected to deliver a double digit increase in earnings per share, while starting to pay down the $9.5 billion in debt it took on for the deal … In the eat-or-be-eaten grocery industry, which is ever threatened by Wal-Mart expanding into that niche, this deal assured Supervalu a place at the table for many years to come.”

• “Whenever he's invited to speak to business school students, Jeff is always asked if he wanted to be a CEO back in his college days. His reply: ‘No, I just never approached things that way. I took things very incrementally. And frankly it wasn't until the last few years before I became the CEO that I thought, 'maybe I can do this, maybe I have the skills to do this’.’”

• “Jeff said his experience in Miami was one of the most difficult times of his career. After bringing about 15 people down from Supervalu's other offices to work with him in Florida, Supervalu's major customer there sold out to a national retailer, with its own distribution arm.

“Former Supervalu CEO Mike Wright pushed his young executive to make a tough decision and after considering a variety of options, Jeff decided Supervalu should shut down its Miami warehouse, and lay off about 200 employees there … He and some other managers set up a human-resources center in the warehouse and gave lessons in résumé writing.

“’We didn't wrap up until everyone who wanted a job, had one,’ Jeff said.”

• “The most tangible example of Jeff's desire to listen to others came after the merger with Albertsons.

“Noddle said he's proud that about 45 percent of the top 130 executives at Supervalu today are from Albertsons.

“Even before the deal closed, Jeff said he was pressured by Wall Street to name his leadership team. Instead, he took his time and waited several months before choosing managers so that he could get to know the Albertsons folks and give them a fair shot at senior positions.

“He also banned the word ‘integration’ among managers, instead declaring it was a new Supervalu. The word choice was a subtle way to illustrate that Supervalu is ‘transitioning to a new enterprise’ and that it respected the experience and ideas of the Albertsons employees.

KC's View:
Noddle tells the paper that he may someday write a case study of the Albertsons deal. I hope so…it almost certainly will make intriguing reading.