Safeway Confirms Sale Talks...

[marshd1000]

In the case of divested stores in the Puget Sound region of Washington State, I actually could see Haggen, backed by its new investors taking some of the stores. I know Haggen has struggled. But I also think that in some areas, it is because there may have been more competition or the locations were not that great. But in Burien, there are two Albertsons and a Safeway, all on 1st Avenue South. The Albertsons are in the north and south ends of town and the Safeway is in the center. It seems to me that at least one store will have to go away. In the case of Burien, I could see Haggen either taking the Safeway, which is in a busy strip center or the 5 Corners Albertsons. Both stores serve a solidly middle to upper middle class demographic, which I think is what Haggen goes for. The North Burien Albertsons is in a area that is more middle to lower class. So I doubt Haggen would want that!

[BillyGr]

Just as an insight - in this area when Rite Aid bought Eckerd they had a couple locations where they were required to sell off a store. The two I know of, one was sold to Kinney (a pharmacy chain local to Northern NY)and that one is still open (albeit in a new building). The other went to Medicine Shoppe and only stayed a short time before closing.

In both cases there were bigger chains (CVS and Walgreens in the 1st, Walgreens in the 2nd) that were not in the areas of these stores and could have taken them, but I do not know if they just weren't interested or if Rite Aid had the option to sell to the smaller chain if they wished.

[storewanderer]

I think Haggen is a great operator and logically should be a good fit for divested stores. Haggen has very strong perimeter programs for all departments. Better than Safeway for sure since Safeway's execution has fallen off a cliff in the past few years, and probably also better than Albertsons Northwest (which seems to be the worst of the Albertsons divisions). But with all the stores they have closed, I just have to wonder, can they be successful at adding stores? I'm also not sure what the labor situation would be. My observation has been the employee attitude in Haggen is much better than Safeway or Albertsons.

It is possible that none of the larger operators want stores too. Or they are possibly not being allowed to buy due to "already being in the market area." In that 1999 Albertsons/ASC Merger part of the goal of the divesting was to "bring new operators to the market area." We see how that worked out for Raleys and Ralphs. Also in that a block of stores was sold to independents. That was a result of independents unhappy (maybe they sued) who tried to bid on divested Albertsons/Buttrey Stores and claimed the process was unfair or they didn't have a chance or something.

[Brian Lutz]

Haggen can do some really nice stores if they put their minds to it (I thought they did a really good job with the former Larry's Market in Redmond, even if the location did suffer from its location) but They made some pretty significant missteps with the Northwest Fresh concept, which just seemed off for some reason. Unfortunately, they don't seem to have a whole lot of stores left around here, and I don't them picking up any in this area since Albertson's is pretty sparse here too.

[CalItalian]

Sam Zell confirms bid for stores to be spun off...
http://supermarketnews.com/retail-finan ... s-spinoffs

[storewanderer]

I am really curious to see 140 stores scattered with probably little to no critical mass anywhere all go to the same bidder and one currently not in the grocery business or almost not in the grocery business.

I was expecting existing operators such as Stater, Kroger, etc. to buy stores. So what I am wondering is if existing operators are passing on these stores, if Albertsons does not want to sell to stronger/established competitors, or exactly what factors are at play. Maybe with one of these deals to a new operator they can also unload a distribution center or two.

The QFC thing makes a bit of sense to this. QFC before being sold to Fred Meyer had said they were looking to buy many small regional chains across the west. QFC itself never really had critical mass and adding Hughes again was adding stores scattered in a large region without much critical mass. I think the Portland QFC Stores were added after Fred Meyer bought QFC but I suspect the deal was already in the making when QFC was still on its own. So I can see how this Zell/Sloan combination may be sort of like picking up where they left off, sort of.

I am excited to see new operators develop from this deal though if they do indeed sell to bidders not currently in the grocery business.

[jamcool]

I suspect most of those stores are in SoCal

[klkla]

I suspect most of those stores are in SoCal

I would agree because they both have large operations in SoCal. San Diego in particular where Vons is a strong #1 and Albertsons #2. I would have thought Ralphs and Stater Bros would be fighting hard to get these locations.

They also have a lot of overlap in Dallas/Fort Worth.

There will probably be a few divestitures each in Pacific Northwest, Arizona and Colorado, as well.

[storewanderer]

I could see one or two stores divested back east also. Acme and Safeway touch on the MD Shore. Maybe just one store. Also maybe in DE there is some overlap. And there is still that one PA Genuardis that Safeway had to keep open due to its lease which is still open. http://weeklyspecials.genuardis.com/cus ... oreID=1004 This store has been running a special "smaller" ad ever since the others closed.

[BillyGr]

I could see one or two stores divested back east also. Acme and Safeway touch on the MD Shore. Maybe just one store. Also maybe in DE there is some overlap. And there is still that one PA Genuardis that Safeway had to keep open due to its lease which is still open. http://weeklyspecials.genuardis.com/cus ... oreID=1004 This store has been running a special "smaller" ad ever since the others closed.

Both stores list a location in Easton, MD - there are also Chester and Chestertown locations, not sure if those are close or the same town/parts of the same?

Dover and Wilmington in DE have locations of both as well.

No idea, though if that would require either store to be closed (assuming it would depend on what other stores are in the area(s)).

Maybe they could convert the Genuardis to the ACME name, as that's more likely to be found in PA?