If the Federal Trade Commission says it’s OK, Haggen will acquire 146 former Safeway and Albertsons stores throughout Washington, Oregon, California, Nevada and Arizona.
The Bellingham-based grocery chain would go from having 18 stores to 164. The deal doesn’t include any locations in Whatcom County, and the Safeway opening next year in Sunset Square won’t become a Haggen. Safeway stores in Oak Harbor, Everett and Shoreline, would become Haggens. Haggen headquarters will remain in Bellingham, Clougher said.
The transaction should close in early 2015, and Haggen will convert all 146 stores to Haggen-brand stores during the first half of 2015. The store’s current employees will be have the opportunity to work at Haggen, and CEO John Clougher said he plans to retain the current stores’ management teams.
“We’re going to offer everyone who works at those stores a job. That’s our commitment,” Clougher said.
Haggen will hire an additional 200 people, mostly in the Pacific Southwest region, Clougher said.
After the deal, the company will be led by two co-CEOs. Clougher will be the Pacific Northwest region’s CEO, and Bill Shaner, former CEO Here Today discount retailer and Save-A-Lot foods, has been hired as CEO of the Pacific Southwest region.
Haggen closed 10 stores in the past two years. When Clougher took over as CEO in October, he said sales numbers were up and that Haggen was ready to grow again.
Cerberus Capital Management, the private investment firm that manages Safeway and Albertsons, came to Clougher with the opportunity to buy the stores a few months ago, he said. Shaner and Clougher have been working together for 120 days.
“From my perspective it’s a great opportunity for Haggen and the businesses that support us,” Clougher said. “My goal is to grow Haggen and grow it in a healthy fashion.”
Haggen does business differently than Safeway or Albertsons and has more emphasis on local products, Clougher said. The brand will take that into account while transitioning the stores.
“Our basic strategy is when the brand changes to Haggen, we want to do everything we can to make sure the customer base of that store can still get the products that they want,” Clougher said. “Our process is to not disrupt the current experience, yet we do want to bring the Haggen experience by bringing in our private label and some of our great bakery products and food services. We’re looking to add, we’re not looking to take away.”
Cerberus Capital Management, the private equity firm that owns Albertsons, is selling the stores to help gain regulatory approval from the Federal Trade Commission for their planned merger with Safeway.
Albertsons and Safeway are selling 168 stores total. Associated Food Stores will purchase eight stores in Montana and Wyoming, associated Wholesale Grocers/Minyards will purchase 12 stores in Texas, and SuperValu will purchase two stores in Washington. The purchase agreements with the four buyers are all subject to approval by the Federal Trade Commission.
See a map of the store locations here.
And here’s a list of the stores Haggen will acquire.