Winn-Dixie Sells Off Alabama Stores as Grocery Chess Match Continues

Winn-Dixie is selling three of its Alabama supermarkets to regional competitor Food City, a deal that will see the locations change hands in early November, as first reported by Supermarket News. The move is the latest step in a complex restructuring for the long-standing grocery brand as it navigates a crowded market.

• Growth by subtraction: Winn-Dixie's parent company, Southeastern Grocers, framed the sale as a strategic decision that allows it to "accelerate reinvestment into innovation and the renewal of our store fleet."

• The Aldi two-step: The divestment follows a dramatic ownership shuffle. Just months ago, a consortium including Southeastern Grocers' own CEO bought back around 170 Winn-Dixie locations. The move partially unwound German discounter Aldi's full acquisition of the chain from August 2023, leaving Aldi with about 220 stores to rebrand under its own banner.

The deal leaves a leaner Winn-Dixie squeezed between the expanding footprint of discounter Aldi on one side and aggressive regional players on the other, fighting for relevance in a rapidly consolidating industry.

This sale is part of a years-long effort by Winn-Dixie's parent company to stabilize its business, which has included exploring a full sale and canceling a planned IPO. The move also reflects a broader trend of high-stakes consolidation reshaping the U.S. grocery sector.