Over the weekend, WinnDixie announced that managing director, Bruce Souder, “was no longer with the company.” No reason was given for Mr. Souder’s departure, nor was there any inkling that Mr. Souder was planning on leaving.
He is being replaced in the interim by Mark Sellers, Group Vice President of Operations. In the release, Mr. Sellers was “given the additional responsibility of overseeing operations of all of The Bahamas division’s 12 stores on an interim basis.”
The Guardian has learnt, however, that Mr. Souder himself may have been unaware of his own departure. On Friday, according to reports reaching The Guardian, Winn Dixie executives arrived and were met at the airport by Mr. Souder. Sources allege that Mr. Souder was informed of his new relationship and returned alone to Bahamas Supermarkets Limited’s (BSL) headquarters, off the East West highway. The executives arrived by taxi.
Upon arriving at the headquarters, Mr. Souder was requested to remain outside the building while the Winn Dixie executives conducted an investigation.. Sources inform the Guardian that the
investigation lasted an hour, during which all operations ceased. Upon completing their investigation, the WinnDixie executives took a taxi back to the Nassau International Airport and then on to Jacksonville, where Winn Dixie is headquartered. Mr. Souder succeeded Jim Bradley in 1989 as managing director.
One source said that, “everyone was in shock” when the news began filtering through the corridors and offices. Up to press time, there was still no suggestion or idea for the sudden change at BSL but sources suspect that “by Monday, we will hear something.”
Sources also indicate that financial controller, Brian Knowles, will be taking care of day-to-day operations until Mr. Sellers “settles in.” There is no indication that Mr. Sellers will be moving to The Bahamas for any appreciable period, since as Group VP for operations, he would have his hands full with Chapter 11 reorganisation, particularly in the wake of hurricanes Katrina and Rita.
But that the VP of Operations has been parachuted in underscores what has long been known and reconfirmed by sources over the weekend that, as one source put it, “The Bahamas stores carry them.” Over 85 percent of BSL’s profits go to Winn Dixie and according to a BSL spokesperson interviewed during a media report of an impending BSL sale, BSL was an integral part of Chapter 11 re-organisation.
Winn-Dixie has maintained, that it has no intention of selling BSL. But even if BSL was on the block, it is highly unlikely that a local group would be able to hurdle foreign exchange rules.
Earlier, when the story of Winn Dixie’s troubles first broke, principal at Benchmark, Julian Brown, had said that it was “unlikely that the government or the Central Bank would allow that amount ($100 million) of money to be taken out of the system, in a single amount” if the sale was in B Dollars.
Mr. Brown had said that under the circumstances (Chapter 11 and being strapped for cash) a non-Bahamian buyer would be a more attractive option for Winn Dixie, since “the parent company would get the money” [without the hassle of foreign currency exchange rules]. From the side of the government, such a sale would “have no impact on, the economy in terms of repatriation of funds.”
Clearly, there is interest in buying BSL, both within and without The Bahamas but whether BSL is sold or not, Mr. Sellers will find that shareholder value can be improved through a rationalization of BSL’s operations.
Sources with an understanding of the industry, have suggested that BSL’s operations were allowed to lag behind technological developments in the industry, for instance, checkout systems that incorporate inventory control, while greatly diminishing the short falls of the error-prone cashier system – precisely because it depended so heavily on the cash generated by BSL.
As Mr. Brown then noted, BSL currently pays quarterly dividends but once paid monthly dividends, so that the parent company could rely on the cash flow generated by BSL and ease the burden of its failing business model, a failing, which eventually caught up with, and forced Winn-Dixie into Chapter 11.
Attempts to reach the BSL spokesperson for comment were unsuccessful.
By: C. E. HUGGINS Nassau Guardian Business Editor
