Supervalu Cuts Major Remodels in Half

[maynesg]

Hi, I read an article that at one time Shaws had 68 stores in Conn. Hey, This company is goingt to get rid of the dead wood in these divisions to make these chains extremly atractive to buyers and then Super Valu is going sell them ,
Rummors persist that Acme has already been purchased by Kroger, and it will not be released till
April. Acme has layed off District Staffs, closed nothern teir stores, just as Shaws is getting rid of lower teir stores. Maybe there is some truth to it. remember Kroger does not opperate stores in the Mid Atlantic or New England areas ( If you do not count Turkey Hill).It would be the best thing to happen to both these chains if it is true.
As far as building for the future with Sav A Lot, that would seem to be a short term remedy. Yes when things were the Pits in the Carter years Sav A Lot and many other box stores did well but as soon as the economy came back only Aldi and Sav A Lot are still around. Unless weare looking at a Great Depresison again , I don!t get it.

[krogerclerk]

Kroger isn't likely to buy unless the terms are really good. Financing is going to be a hard sell and Wall Street doesn't like Kroger sacrificing profit margins for sales growth. Shaw's and Acme fit into the Kroger strategy of being number one or two in market share in its major markets and there is no overlap with Kroger's supermarket operations, though Turkey Hill c-stores could be tied in with merchandising and fuel perks with Acme.

On the down side, the Northeast is an area that Kroger has no familiarity, from customers to the company itself. Also, these are not growth markets like Kroger prefers. In a press release, Kroger stated that the highest growth markets in the US that it doesn't have a presence are in Florida(this was prior to the recession beginning). I really think Kroger would be interested in a northeast foothold, be it from SuperValu, Ahold or A&P, which over the last decade have been rumored.
But Jewel would be the SuperValu operation that Kroger would be most hungry to get, as ABS and SVU's most consistently profitable division. Kroger has opened about 6 Food 4 Less stores in Chicagoland, which is enough to test the waters for a re-entry to the market, and not enough mass to cause FTC concerns if Kroger acquired Jewel or Dominick's.

My guess would be if Ahold divested its US operations, it would be more attractive to Kroger, as Giant-PA is very similar to Kroger's operations, and Giant-MD is the market leader in the DC region, a growth market that is relatively recession proof and Stop&Shop is the leading New England chain, but the NYC presence of S&S would be a turnoff. Kroger has little familiarity in truly urban regions like Philly and NYC.

[maynesg]

Hi, I can only tell you what I have heard from vendors , sales people,some company management,
If it happens it happens. However, six months ago a deal with Kroger fell apart because Super Valu would not sell the warehouse in Denver PA , but wanted a supplier contract for 10 years( Super Valu closedtwo warehouses including one in Harrisburgh and consolidated at Denver) I have heard from Acme union drivers that they have been told that they are to be transfered to Harrisburgh some time after April.
But who knows? Rumors get started and seem to build upon themselves, I guess time will tell.
Also, Acme dosen!t have many stores left in nthe NY market with the closure of Jersey City and Secacaucus , leaving Clifton and a handfull of stores in the Watergap or in the Middle of New Jersey, that are verry close to the Philly Market. Remember Acme only has a handfullmof stores in the city of Philadelphia or in any City. The stores in Wilmington with the exception of Dupont Street are not in the city, but in unincorporated surburban, New Castle County.( About a Third of the county is unincorporated and has Wilmington Zip Codes.

[DerangedHermit]

My guess would be if Ahold divested its US operations, it would be more attractive to Kroger, as Giant-PA is very similar to Kroger's operations, and Giant-MD is the market leader in the DC region, a growth market that is relatively recession proof and Stop&Shop is the leading New England chain, but the NYC presence of S&S would be a turnoff. Kroger has little familiarity in truly urban regions like Philly and NYC.

I'm surprised no one's tried to take a better shot against A&P in NYC and on Long Island.