Supervalu Setting Up IT Shop in India; Ups Q3 and Q4 Guidance

DECEMBER 14, 2006 -- MINNEAPOLIS - Like Tesco and Target before it, Supervalu here is reportedly setting up an IT shop in Bangalore, India, planning a $50 million investment over the next five years.

The retailer\wholesaler also said it was upping its guidance for the last half of fiscal 2007, on the plumped up performance owing to its acquisition of "Albertsons' premier retail properties" in June.

News reports circulated in India about Supervalu's plan to set up operations in Bangalore to support its overall IT requirements. The new subsidiary, Supervalu Services India (SSI), will employ 50 people, added to 1,800 associates working at three different locations in the U.S. as part of its IT division. The company plans to grow SSI to a team of 300 IT professionals in the next 12-18 months, the reports said.

"SSI will be a key part of Supervalu's IT organization and will help in new applications development, technical operations and testing to support the overall corporate functions of the company including the retail and supply chain operations," Supervalu c.i.o. Paul Singer was quoted as saying. "We want to build a strong local team here with strong skills in Java and other leading edge development tools."

Supervalu already reportedly works with 800 outside contractors, of which 200 are based out of India. The company works with many Indian IT companies for sourcing the applications and solutions required for its retail management.

The Bangalore team will work on end-to-end application developments, supporting the IT division round the clock. SSI will work on about 400 projects involving development of software applications and end-to-end solutions in retail operations, spanning supply chain management procurement logistics and accounting.