EDEN PRAIRIE, Minn. (WCCO) — Employees saw the writing on the wall last week when Eden Prairie-based Supervalu unloaded its massive debt and spun off half of its grocery businesses.

In a fight to turn around the grocery giant, Supervalu sold 877 of its retail grocery stores to AB Acquisition LLC for $100 million and the assumption of $3.2 billion in Supervalu debt.

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Now, the other shoe has dropped as the company began issuing pink slips to 600 of its 2,700 corporate employees — the total nationwide layoffs will total more than 1,100.

“Today is difficult because of the impact it does have,” explained company spokesman, Mike Siemienas.

NewsRadio 830 WCCO’s Chris Simon Reports

Supervalu has been hit hard in recent years by the growing competition in the grocery business. Margins were already razor thin and retailers like Wal-Mart, Target and Costco are all slicing the grocery pie even smaller.

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People leaving Supervalu’s Eden Prairie headquarters on Tuesday declined to discuss the cuts, which are hitting all levels and all departments.

Siemienas said the layoffs are “including human resources, marketing, merchandising and IT. And also affects all levels of the organization from entry level to Vice Presidents.”

The streamlined grocery chain will now concentrate on its flagship Cub Foods and Sav-A-Lot stores, as well as its grocery wholesale business. A spokesman made it clear that employees at the retail store level are not affected by the cuts.

“Our Cub Food associates, cashiers, bakers, butchers and deli clerks, are not affected by today’s announcement,” Siemienas explained.

In Supervalu’s news release, CEO Sam Duncan called the cuts, “the necessary next step in the rebuilding of our business.”

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Supervalu has about 3,470 stores in the U.S. and approximately 35,000 employees, and the company’s shares fell 26 cents, or 5.2 percent, to $4.79 in premarket trading.