Foodstuffs New Zealand will close its two New World supermarkets in Redcliffs and St Martins, with the loss of 235 jobs.
Foodstuffs South Island chief executive Steve Anderson says the severity of the damage means neither store can reopen.
The decision affects 167 full-time and part-time staff at the St Martins store, and 69 full-time and part-time staff at Redcliffs.
Mr Anderson says workers will receive redundancy equivalent to two months' pay as well as shopping vouchers worth up to $500.
He says Foodstuffs plans to rebuild both stores but this is likely to be a long process.
Another New World store closed in Kaiapoi, at a cost of 86 jobs, after the September earthquake.