What normally happens (at least has happened in Arizona multiple times) is that if the 2nd store (which should've been divested) only remains open for a period of time (could be one year, could be five, could be ten, could be fifteen) before it closes and is kept "dark" and set up with a deed restriction that nobody else can operate the store as a supermarket. If it ever does re-open the box is used for a thrift store (Savers or Goodwill) and/or a gym (EOS Fitness, Planet Fitness or Mountainside Fitness).ClownLoach wrote: ↑February 22nd, 2024, 1:01 pm
Second, they will also be found to have not divested stores where it is needed out of the simple reason of greed. If it's a highly profitable store they will have kept it, overlap or not. Some of the odd behaviors seen like rebranding of some Albertsons companies stores will be revealed to have been done in collusion with Kroger to protect as many sales as possible once the stores that were selected for C&S are gone. Same for some of the odd remodeling, or lack of remodeling we have seen where one store is magically neglected while the other is on its second or third remodel. Obviously both sides have the list and are neglecting the divests while fixing up the keepers. The fact is that any store that actually needed to be divested for the purpose of monopoly prevention will not be on the list, and it won't get there until they are forced by the FTC or a State AG to sell said store.
🛒 Kroger-Albertsons Merger: National Impact
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Re: 🛒 Kroger-Albertsons Merger: National Impact
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Re: 🛒 Kroger-Albertsons Merger: National Impact
I know that there's an Albertsons in Irving that recently opened (extensively renovated Minyard-turned-Fiesta), while the nearby Kroger is a former Safeway that's seen better days. It's pretty obvious that if the merger was to proceed, the Albertsons would be kept. But the Albertsons employees aren't unionized, and Kroger is. For some of these markets it could be seen as a backdoor way to dispose of unionized workers (and Kroger almost certainly won't have its acquired non-union stores unionized).ClownLoach wrote: ↑February 22nd, 2024, 1:05 pmDon't you think it's odd that another big executive is now leaving too, after the Kroger CFO, who could have easily been in line to be the next CEO in a few years? Why did C&S change the CEO? Maybe he realized he signed a sucker deal and it's going to implode the company, so he decided to hop on a golden parachute and get out so that someone else can deal with the mess?pseudo3d wrote: ↑February 22nd, 2024, 12:18 pmThat definitely sounds like it would sink the deal.retailfanmitchell019 wrote: ↑February 22nd, 2024, 8:44 am
““Do we have to say that we won’t close stores?” Bob Palmer, outgoing CEO of New Hampshire-based C&S Wholesale, asked last year about plans to buy the 413 locations, according to newly unredacted passages in the state’s suit.
In the passage, Palmer appears to concede that the stores will “stay open” during the sales process, “but then what?” he asks.
“Are we committed to this?”
My main piece of evidence is that they have neither executed an arrangement to buy more stores nor revealed where those stores were. A month before the deal between the deal between Albertsons and Safeway was finalized, the divested store locations were released to the public, we don't even have that yet.
If I had to guess, they're getting these stores at liquidation value or the price Hilco or someone else would pay in bankruptcy proceedings to wind them down. Why else would there even be a question so damning as "are we committed to this?" Obviously C&S has zero intention or interest to operate these stores as a real competitor. They are there to liquidate them in one form or another, either with a store closing sale or a cash sale to a local IGA, ethnic operator, etc. And thereby will be used as a conduit to break the union agreements with the workers in those stores.
I really have to wonder if they had bids from real, committed operators and they turned them down? Raleys? Save Mart? Stater Bros? Etc. I'll bet each wanted stores in their markets. But they want them to operate them, and Kroger/Albertsons want them to close.
As for C&S I would expect to see them dump the eleven Grand Union stores within six months of the merger getting axed.
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Re: 🛒 Kroger-Albertsons Merger: National Impact
All TX Stores sold will be Albertsons owned. No Kroger stores will be divested in TX, LA..
The only places they're divesting any Kroger stuff seems to be VA, MD, CA, OR, WA, and IL...
The only places they're divesting any Kroger stuff seems to be VA, MD, CA, OR, WA, and IL...
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Re: 🛒 Kroger-Albertsons Merger: National Impact
The executive change at C&S was announced in August 2023. The announcement that C&S would take over divested stores was in September 2023.ClownLoach wrote: ↑February 22nd, 2024, 1:05 pmDon't you think it's odd that another big executive is now leaving too, after the Kroger CFO, who could have easily been in line to be the next CEO in a few years? Why did C&S change the CEO? Maybe he realized he signed a sucker deal and it's going to implode the company, so he decided to hop on a golden parachute and get out so that someone else can deal with the mess?pseudo3d wrote: ↑February 22nd, 2024, 12:18 pmThat definitely sounds like it would sink the deal.retailfanmitchell019 wrote: ↑February 22nd, 2024, 8:44 am
““Do we have to say that we won’t close stores?” Bob Palmer, outgoing CEO of New Hampshire-based C&S Wholesale, asked last year about plans to buy the 413 locations, according to newly unredacted passages in the state’s suit.
In the passage, Palmer appears to concede that the stores will “stay open” during the sales process, “but then what?” he asks.
“Are we committed to this?”
My main piece of evidence is that they have neither executed an arrangement to buy more stores nor revealed where those stores were. A month before the deal between the deal between Albertsons and Safeway was finalized, the divested store locations were released to the public, we don't even have that yet.
If I had to guess, they're getting these stores at liquidation value or the price Hilco or someone else would pay in bankruptcy proceedings to wind them down. Why else would there even be a question so damning as "are we committed to this?" Obviously C&S has zero intention or interest to operate these stores as a real competitor. They are there to liquidate them in one form or another, either with a store closing sale or a cash sale to a local IGA, ethnic operator, etc. And thereby will be used as a conduit to break the union agreements with the workers in those stores.
I really have to wonder if they had bids from real, committed operators and they turned them down? Raleys? Save Mart? Stater Bros? Etc. I'll bet each wanted stores in their markets. But they want them to operate them, and Kroger/Albertsons want them to close.
Who knows- maybe this new C&S incoming CEO (former COO) is who worked the divest deal out and his "award" for winning the bid was to get the CEO position.
Didn't I do something that determined C&S was getting stores for $5 million each and Haggen paid $10 million each? I forget.
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Re: 🛒 Kroger-Albertsons Merger: National Impact
Yes! And this practice needs to be prohibited from use by the new Kroger, if a merger were to be approved. They know that it is easy for a less capitalized local competitor or ethnic market to take over when the store is already built out as a supermarket. It saves at least ten to fifteen million dollars of construction cost. The deed restrictions allowing dead rent or no other groceries reuse should be illegal. If a merger is approved then all owned property that is closed should be required to be sold immediately and restriction free (and a broker who specializes in grocery store reuse assigned in advance). Any leased property must be paid off, fully severed, no restrictions so landlord can replace them. This is the definition of "anti competitive behavior."arizonaguy wrote: ↑February 22nd, 2024, 9:04 pmWhat normally happens (at least has happened in Arizona multiple times) is that if the 2nd store (which should've been divested) only remains open for a period of time (could be one year, could be five, could be ten, could be fifteen) before it closes and is kept "dark" and set up with a deed restriction that nobody else can operate the store as a supermarket. If it ever does re-open the box is used for a thrift store (Savers or Goodwill) and/or a gym (EOS Fitness, Planet Fitness or Mountainside Fitness).ClownLoach wrote: ↑February 22nd, 2024, 1:01 pm
Second, they will also be found to have not divested stores where it is needed out of the simple reason of greed. If it's a highly profitable store they will have kept it, overlap or not. Some of the odd behaviors seen like rebranding of some Albertsons companies stores will be revealed to have been done in collusion with Kroger to protect as many sales as possible once the stores that were selected for C&S are gone. Same for some of the odd remodeling, or lack of remodeling we have seen where one store is magically neglected while the other is on its second or third remodel. Obviously both sides have the list and are neglecting the divests while fixing up the keepers. The fact is that any store that actually needed to be divested for the purpose of monopoly prevention will not be on the list, and it won't get there until they are forced by the FTC or a State AG to sell said store.
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Re: 🛒 Kroger-Albertsons Merger: National Impact
That actually makes it even more suspicious. Outgoing CEO in 99.9% of companies is a lame duck - they do NOT make major deals or decisions. In fact it's usually considered to be a conflict of interest if they do.storewanderer wrote: ↑February 23rd, 2024, 12:27 amThe executive change at C&S was announced in August 2023. The announcement that C&S would take over divested stores was in September 2023.ClownLoach wrote: ↑February 22nd, 2024, 1:05 pmDon't you think it's odd that another big executive is now leaving too, after the Kroger CFO, who could have easily been in line to be the next CEO in a few years? Why did C&S change the CEO? Maybe he realized he signed a sucker deal and it's going to implode the company, so he decided to hop on a golden parachute and get out so that someone else can deal with the mess?pseudo3d wrote: ↑February 22nd, 2024, 12:18 pm
That definitely sounds like it would sink the deal.
My main piece of evidence is that they have neither executed an arrangement to buy more stores nor revealed where those stores were. A month before the deal between the deal between Albertsons and Safeway was finalized, the divested store locations were released to the public, we don't even have that yet.
If I had to guess, they're getting these stores at liquidation value or the price Hilco or someone else would pay in bankruptcy proceedings to wind them down. Why else would there even be a question so damning as "are we committed to this?" Obviously C&S has zero intention or interest to operate these stores as a real competitor. They are there to liquidate them in one form or another, either with a store closing sale or a cash sale to a local IGA, ethnic operator, etc. And thereby will be used as a conduit to break the union agreements with the workers in those stores.
I really have to wonder if they had bids from real, committed operators and they turned them down? Raleys? Save Mart? Stater Bros? Etc. I'll bet each wanted stores in their markets. But they want them to operate them, and Kroger/Albertsons want them to close.
Who knows- maybe this new C&S incoming CEO (former COO) is who worked the divest deal out and his "award" for winning the bid was to get the CEO position.
Didn't I do something that determined C&S was getting stores for $5 million each and Haggen paid $10 million each? I forget.
That makes me think this was planned so that he could be gone when a successor comes in and closes everything, busts union agreements etc. And as the executor of the deal he can claim plausible denial. I smell a rat. He's going to be the "fall guy" who "made a mistake buying these stores" and the new CEO will be "fixing the mistake" by selling them off piecemeal, breaking the union deals, and closing the rest. At $5M per store including inventory and fixtures that is probably less than the price a liquidator would pay for the store... Meaning theoretically C&S could call Hilco, Great American, etc. the day they take over, wind down every acquired store, and make a tidy profit.
And yes, the sale price is suspiciously low. And the more stores sold at the discounted price, the higher the price per store acquired in the merger becomes. The 650 store cap has to be pretty solid because over that amount they could build an entire new Albertsons chain for less per store acquired except in the most urban areas where they already have stores (LA, Seattle, Portland). What it also means as I've said before is that they (Kroger) are probably telling the truth when they promise zero closures of acquired stores, because nobody has ever paid so much per store! The only chance they have of not losing a fortune on the deal is to keep every store open and maximize the return, because they won't get anything close to what they're paying for stores they close later. But keeping the stores open doesn't mean not raising prices thru the roof... Which will be necessary based on the obscene price per acquired store.
But that doesn't protect divested stores which the 400 or so are most likely to be the desired closures (if they were in a perfect world and didn't have to divest) and not necessarily true overlaps or monopolies.
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Re: 🛒 Kroger-Albertsons Merger: National Impact
I can see that happening but they'd be setting themselves up for a lawsuit if they pulled those shenanigans. If the new CEO knew this was a bad deal he'd demand either more stores (the divested stores would be basically be garbage) or want out of the deal altogether. If C&S pulls out or cuts its numbers, then the merger dies, because the list of potential buyers wouldn't be nearly 400.ClownLoach wrote: ↑February 23rd, 2024, 2:09 pmThat actually makes it even more suspicious. Outgoing CEO in 99.9% of companies is a lame duck - they do NOT make major deals or decisions. In fact it's usually considered to be a conflict of interest if they do.storewanderer wrote: ↑February 23rd, 2024, 12:27 amThe executive change at C&S was announced in August 2023. The announcement that C&S would take over divested stores was in September 2023.ClownLoach wrote: ↑February 22nd, 2024, 1:05 pm
Don't you think it's odd that another big executive is now leaving too, after the Kroger CFO, who could have easily been in line to be the next CEO in a few years? Why did C&S change the CEO? Maybe he realized he signed a sucker deal and it's going to implode the company, so he decided to hop on a golden parachute and get out so that someone else can deal with the mess?
If I had to guess, they're getting these stores at liquidation value or the price Hilco or someone else would pay in bankruptcy proceedings to wind them down. Why else would there even be a question so damning as "are we committed to this?" Obviously C&S has zero intention or interest to operate these stores as a real competitor. They are there to liquidate them in one form or another, either with a store closing sale or a cash sale to a local IGA, ethnic operator, etc. And thereby will be used as a conduit to break the union agreements with the workers in those stores.
I really have to wonder if they had bids from real, committed operators and they turned them down? Raleys? Save Mart? Stater Bros? Etc. I'll bet each wanted stores in their markets. But they want them to operate them, and Kroger/Albertsons want them to close.
Who knows- maybe this new C&S incoming CEO (former COO) is who worked the divest deal out and his "award" for winning the bid was to get the CEO position.
Didn't I do something that determined C&S was getting stores for $5 million each and Haggen paid $10 million each? I forget.
That makes me think this was planned so that he could be gone when a successor comes in and closes everything, busts union agreements etc. And as the executor of the deal he can claim plausible denial. I smell a rat. He's going to be the "fall guy" who "made a mistake buying these stores" and the new CEO will be "fixing the mistake" by selling them off piecemeal, breaking the union deals, and closing the rest. At $5M per store including inventory and fixtures that is probably less than the price a liquidator would pay for the store... Meaning theoretically C&S could call Hilco, Great American, etc. the day they take over, wind down every acquired store, and make a tidy profit.
And yes, the sale price is suspiciously low. And the more stores sold at the discounted price, the higher the price per store acquired in the merger becomes. The 650 store cap has to be pretty solid because over that amount they could build an entire new Albertsons chain for less per store acquired except in the most urban areas where they already have stores (LA, Seattle, Portland). What it also means as I've said before is that they (Kroger) are probably telling the truth when they promise zero closures of acquired stores, because nobody has ever paid so much per store! The only chance they have of not losing a fortune on the deal is to keep every store open and maximize the return, because they won't get anything close to what they're paying for stores they close later. But keeping the stores open doesn't mean not raising prices thru the roof... Which will be necessary based on the obscene price per acquired store.
But that doesn't protect divested stores which the 400 or so are most likely to be the desired closures (if they were in a perfect world and didn't have to divest) and not necessarily true overlaps or monopolies.
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Re: 🛒 Kroger-Albertsons Merger: National Impact
His quote in that article is pretty damning. There is no commitment to run these stores. Again they can close them all immediately and turn a profit. Selling them piecemeal will also likely be profitable. How could anyone enforce any promise to operate them for any given amount of time? They would technically be able to file bankruptcy almost immediately with clever accounting to get out of any such agreement if someone tried to enforce it.pseudo3d wrote: ↑February 23rd, 2024, 3:14 pmI can see that happening but they'd be setting themselves up for a lawsuit if they pulled those shenanigans. If the new CEO knew this was a bad deal he'd demand either more stores (the divested stores would be basically be garbage) or want out of the deal altogether. If C&S pulls out or cuts its numbers, then the merger dies, because the list of potential buyers wouldn't be nearly 400.ClownLoach wrote: ↑February 23rd, 2024, 2:09 pmThat actually makes it even more suspicious. Outgoing CEO in 99.9% of companies is a lame duck - they do NOT make major deals or decisions. In fact it's usually considered to be a conflict of interest if they do.storewanderer wrote: ↑February 23rd, 2024, 12:27 am
The executive change at C&S was announced in August 2023. The announcement that C&S would take over divested stores was in September 2023.
Who knows- maybe this new C&S incoming CEO (former COO) is who worked the divest deal out and his "award" for winning the bid was to get the CEO position.
Didn't I do something that determined C&S was getting stores for $5 million each and Haggen paid $10 million each? I forget.
That makes me think this was planned so that he could be gone when a successor comes in and closes everything, busts union agreements etc. And as the executor of the deal he can claim plausible denial. I smell a rat. He's going to be the "fall guy" who "made a mistake buying these stores" and the new CEO will be "fixing the mistake" by selling them off piecemeal, breaking the union deals, and closing the rest. At $5M per store including inventory and fixtures that is probably less than the price a liquidator would pay for the store... Meaning theoretically C&S could call Hilco, Great American, etc. the day they take over, wind down every acquired store, and make a tidy profit.
And yes, the sale price is suspiciously low. And the more stores sold at the discounted price, the higher the price per store acquired in the merger becomes. The 650 store cap has to be pretty solid because over that amount they could build an entire new Albertsons chain for less per store acquired except in the most urban areas where they already have stores (LA, Seattle, Portland). What it also means as I've said before is that they (Kroger) are probably telling the truth when they promise zero closures of acquired stores, because nobody has ever paid so much per store! The only chance they have of not losing a fortune on the deal is to keep every store open and maximize the return, because they won't get anything close to what they're paying for stores they close later. But keeping the stores open doesn't mean not raising prices thru the roof... Which will be necessary based on the obscene price per acquired store.
But that doesn't protect divested stores which the 400 or so are most likely to be the desired closures (if they were in a perfect world and didn't have to divest) and not necessarily true overlaps or monopolies.
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FTC Sues to block Kroger-Albertsons merger
As expected, the FTC has thrown its full weight against the merger - I think this is the coup de grâce...
https://www.cnbc.com/2024/02/26/ftc-sue ... erger.html
https://www.cnbc.com/2024/02/26/ftc-sue ... erger.html
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Re: FTC Sues to block Kroger-Albertsons merger
It was filed in U.S. District Court in Oregon which that article doesn't mention. Very smart.cathandler wrote: ↑February 26th, 2024, 9:18 am As expected, the FTC has thrown its full weight against the merger - I think this is the coup de grâce...
https://www.cnbc.com/2024/02/26/ftc-sue ... erger.html