I wouldn't say no one wanted the Safeway spin-offs (and besides, Vons bought the SoCal division), they were just too big by themselves to become an acquisition target but also too big to operate successfully with the funds they had. Harvest Foods might have worked as they had good money but they took a wrong turn by spending a lot of money on Skaggs stores a few states away. AppleTree succumbed to heavy competition in Houston early on but the College Station/Bryan stores outlasted the Houston stores by nearly a decade.klkla wrote: ↑February 18th, 2018, 7:04 pmThe Safeway spin-offs were different. Those were divisions that nobody wanted and so the local management put together financing and bought them with the intention of operating the chains successfully.pseudo3d wrote: ↑February 18th, 2018, 1:10 pmIt's not just recently, this has been going back years. This is how a lot of the Safeway spin-offs sunk (like AppleTree) was just a lot of debt load and not being able to do much with the chain as a result. I don't think private equity firms are to blame. A lot of retail establishments have done poorly in moving forward (new prototypes, adapting to Walmart and Amazon, etc.), and my personal opinion is that an industry-wide move many years ago of eliminating salespeople and demoralizing employees helped push consumers away from specialty/department stores to cheaper discount stores and online retailers.
While there are some good private equity firms there are others that exist simply to enrich themselves and have no interest in the long term success of the company, their employees, the communities they serve or the customers. They buy these companies using debt only, and then pay themselves large dividends and management fees and then add more debt so they can keep doing that until they have drained every penny they can get and then declare bankruptcy. They are never held accountable or required to reinvest money back into the company.
As a point to the "too big for an acquisition", in 1999 Kroger had wanted to purchase the Texas Division of Winn-Dixie (even the milk plant)--I don't have a link because I wrote this all my cell phone but it's a Google search away. It would've put Kroger up higher in terms of market share in DFW (as of 1996 they were behind Albertsons, Tom Thumb, and Minyard) and allowed them to enter Waco, Oklahoma, and a few smaller North Texas markets. It also would give them four stores in Bryan-College Station, what with a new store coming a year away (they never had more than 3, now down to 2). The FTC ultimately caused Kroger to drop the bid and by 2002 they only took 7 stores. All this is important because despite the Texas Division being (arguably) trash, it was still a collection of stores somebody wanted.
As to Tops, their small and dated stores are going to be a hard sell for any larger retailer.