Coborn's, which has more than 80 grocery and liquor stores in the Upper Midwest, has owned Save-A-Lot stores in Freeport, IL, and Dubuque, IA, and plans to open a fourth in Beloit, WI, next month.

Save-A-Lot is rolling out "combo" stores that sell both groceries and fixed-price general merchandise, which analysts say will generate the sales and earnings growth for Supervalu well into the future. The chain, which has more than 1,200 stores across the country, could be several times that size in the next few years, according to analysts.

St. Michael, with a population of about 9,000, is about halfway between the Twin Cities and St. Cloud. The St. Michael store is the spearhead of the chain's expansion into the Twin Cities market. Save-A-Lot stores, which average about 12,000 sf, feature food at prices up to 40% below conventional supermarkets. The chain, which features rapid growth, high inventory turns and low operating costs, has recently beefed up its general merchandise offerings as well.