BillyGr wrote:pseudo3d wrote:
Frankly, it would've been a tough sell for anyone else, and too many of those stores are probably ones that should've closed. (This isn't just an Albertsons problem, 40% of the A&P stores went unused for new retailers). The real reason I think is Wegmans wouldn't want them anyway. They are all too small for its format, and the last thing a chain wants is a bunch of tiny, inferior stores diluting what they've built. It would be interesting that if they do divest, how they'll do it. The East Coast market is different than West Coast, so maybe it will be a more varied mix that could include Ahold Delhaize, Tops, and Big Y.
The only thing that might occur with Wegmans would depend on the store locations, what else is available and what (if any) space exists - for instance if one of the 90,000 Sq. Ft. stores was in an area they were interested in and couldn't get a new building (no land or issues building with the town), buying that one would make sense if it was on a property where they could add the extra 30-50,000 Sq. Ft. to bring it up to their standard size (which could be easier to get permission for an addition vs. an entirely new building).
Also - while Wegmans generally has built these large stores as they have expanded outward, they DO have experience running smaller stores in their "home" market (which is also similar to PC itself, as they have maintained many small stores in the greater Albany area that most chains would have left some time ago).
As to the others, I wouldn't think Ahold/Delhaize would have much involvement, just because most of the Price Chopper areas already have either Hannaford or Stop & Shop in them (not sure on PA if any of the Giant there is in the PC area) so it would seem to be hard for them to buy. The other two seem more possible (Tops being the most logical) to take ones that would need to be sold off.
I seem to recall reading that the smaller Wegmans stores were legacy ones before their average store size went supernova, and kept because they did well and were not competing with the big ones. However, that's not the case here, if they're looking to expand to a new market, they're going to want a 100,000+ square foot store, and neither Wegmans nor their customers want some 60,000 square foot hand-me-down.
As for PA, the stores seem to be prominently in the Scranton/Wilkes-Barre area, and fiddling around with Google Earth shows that despite coming pretty close, ACME and Price Chopper do not overlap. The VT/MA on the other hand does have Shaw's overlap. As for "not selling to failing companies", when Safeway and Albertsons merged, the goal was to find companies that could accept the unionized stores in the West Coast. Problem is, when you took Safeway and Albertsons out of the equation, there weren't a lot of stores that were even eligible. Neither Ralphs nor Stater Bros., two of the eligible candidates, decided to go for it. They have shown that they are not interested in expanding.
The other markets faced similar difficulties. Arizona was dominated by Fry's, which had its own better stores in nearby locations and not interested, and Bashas' was not in expansion mode. In Dallas--similar issue, H-E-B wasn't in town and wasn't interested in expanding Central Market (they took two of the stores, ultimately), and Kroger ALSO usually had better stores (they took one store, ultimately).
When Royal Ahold and Delhaize merged, the goal was to find companies that could accept the unionized stores in the East Coast, and that worked. There were a greater part of the stores were not unionized unlike Albertsons and Safeway, allowing them to sell stores to Publix or Weis, and the pool that were unionized were larger, like ACME or Tops Markets. Price Chopper is not unionized, it's on the
"boycott list" of UFCW 1500, which means that Albertsons would have greater leeway in the available candidates, and that list would include Royal Ahold, Tops, Big Y, or even ShopRite. It's doubtful that Royal Ahold would want to expand at this point, at least significantly.