Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[elsmere241]

https://www.cnbc.com/2022/10/13/shares-of-albertsons-jump-on-report-of-potential-merger-with-grocery-giant-kroger.html

[Pink Jazz]

I wonder if they will be forced to divest Safeway as a condition of the merger.

[SP Cook]

My guess is that the government will look at this one for a while.  The knee jerk reaction is to think the current crew hates “big companies”.  True or not, it loves it some Big Labor, and this creates a big unionized competitor to union free Wal-Mart.

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

The stock market play, as always in these deals, is to figure out who is going to be sold the overlapping stores, as these transactions are often for below value.  Ahold seems likely for some.  The other potential buyers aren’t stock companies.

[WillWeaverRVA]

My guess is that the government will look at this one for a while.  The knee jerk reaction is to think the current crew hates “big companies”.  True or not, it loves it some Big Labor, and this creates a big unionized competitor to union free Wal-Mart.

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

The stock market play, as always in these deals, is to figure out who is going to be sold the overlapping stores, as these transactions are often for below value.  Ahold seems likely for some.  The other potential buyers aren’t stock companies.

The resulting merged company would be truly huge with over 5,000 locations, so I can't see Kroger keeping them all. I would imagine that the excess stores would be sold to regional chains, similar to what happened when Food Lion merged with Ahold - excess Food Lion and Martin's/Giant stores were sold to other chains, most notably Publix.

[triplemultiplex]

[elsmere241]

It's been announced officially: https://www.cnn.com/2022/10/14/business/kroger-albertsons-merger

They see themselves spinning off about 400 stores.

[SP Cook]

They see themselves spinning off about 400 stores.

That is Kroger’s opening proposal.  A single entity owned by the old Albertson’s stock holders containing the overlapping stores. 

Wells-Fargo on the other hand thinks Kroger will have to sell off more stores, about 550 and do so region by region.  W-F is probably correct, a 450 store company with stores in random unconnected places (Texas, inter mountain West, SoCal, DC-BAL, Chicago) would be unwieldy.  Selling a region off to a big chain that doesn’t do business there, would make more sense.

[abefroman329]

It would be a disaster in Chicagoland, especially considering the fact that we've barely recovered from all of the Dominick's being shuttered at the end of 2013.  Kroger would have to decide between shuttering or selling off the Jewel-Osco locations (I assume they'd rather do that than shutter or sell off Mariano's, Food 4 Less, and Roundy's).

[kphoger]

Jewel-Osco locations

I've been assured that the chain is called "Jewel's" because there are more than one of them.

[abefroman329]

Jewel-Osco locations

I've been assured that the chain is called "Jewel's" because there are more than one of them.

[02 Park Ave]

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

At its peak A&P had over 15,000 grocery stores.

[Bruce]

The Safeway/Albertsons merger a while ago managed to leave a lot of Washington worse off in terms of selection and store availability. In my area alone, an Albertson's a few miles between two Safeways was shuttered and Haggen (which bought up many of the overlapping stores) went bankrupt.

[brad2971]

This would be a good time for the likes of Publix, HEB, or HyVee to start picking up market share. HyVee, especially, could end up with a fair number of Chicago-area stores.

Or heck, Amazon could end up with a large number of stores and start doing more expansion of either Amazon Fresh or Whole Foods.

[brad2971]

They see themselves spinning off about 400 stores.

That is Kroger’s opening proposal.  A single entity owned by the old Albertson’s stock holders containing the overlapping stores. 

Wells-Fargo on the other hand thinks Kroger will have to sell off more stores, about 550 and do so region by region.  W-F is probably correct, a 450 store company with stores in random unconnected places (Texas, inter mountain West, SoCal, DC-BAL, Chicago) would be unwieldy.  Selling a region off to a big chain that doesn’t do business there, would make more sense.

Considering that Publix already has stores in Virginia, they could very well end up with every non-Harris Teeter branded store in the DC metro area. On the West Coast, Raley's and Save-Mart could end up with stores in CA, NV, AZ, even UT.

[bandit957]

Another corporate merger the government will rubber-stamp.

[bandit957]

It would be a disaster in Chicagoland, especially considering the fact that we've barely recovered from all of the Dominick's being shuttered at the end of 2013.  Kroger would have to decide between shuttering or selling off the Jewel-Osco locations (I assume they'd rather do that than shutter or sell off Mariano's, Food 4 Less, and Roundy's).

I always thought Jewel-Osco was cool because I thought it had something to do with Oscar the Grouch.

[thenetwork]

If you look at a map of their operations, there are places where they overlap each other greatly and would have unacceptable market shares, and places where one or the other is unknown.  My guess is that they will have to sell of a list of stores in different places, leaving an (almost) truly national grocery chain for the first time in our history. 

At its peak A&P had over 15,000 grocery stores.

But back then, A&P stores, like most major grocers from that era, were only a fraction of the size of most major grocers today, so naturally there were more of them.

[gonealookin]

I don't think this has much impact in Northern Nevada.  Albertson's has some Safeways and Kroger has some Smith's Food and Drug stores, but neither is a market leader.  Walmart and Raley's are probably the two biggest players and Save Mart is also around (similar presence as Safeway and Smith's).

[KEK Inc.]

Kroger already has two banners in the NW (QFC and Fred Meyer).  There won't be much competition, and the cost of living in Seattle is already higher than average.

[jp the roadgeek]

It should have minimal effect in the Northeast, with the nearest Kroger locations being in Virginia and Ohio. The Albertson's stores: Acme and Shaw's/Star Market, have their footprints.  Acme is mostly the Delaware Valley and NJ with some stores as far north at lower Fairfield County, CT and Putnam County, NY and down into northeast MD and DE as a result of the acquisition of former A&P locations, Shaw's/Star is mostly Eastern MA, RI and northern New England.  Most of NY state has neither. 

[bandit957]

People always blow bubbles with bubble gum at our local Kroger.

Plus, there was one time about 4 years ago, I went to Kroger, and some kid who was about 10 years old threw a huge, profanity-laced temper tantrum that lasted a half-hour because he got a lousy toy from a vending machine.

[Pink Jazz]

In Arizona, I can see some of the older non-Marketplace Fry's stores being sold, as well some Albertsons or Safeway stores that are in close proximity to a Fry's Marketplace.

[jeffandnicole]

In the Philly area, Albertsons owns Acme.  Acme tends to be a higher priced store, so the merger is generally being looked at as a good thing, hoping Kroger will bring prices down a bit.

[bandit957]

In New Mexico, Kroger owns Smith's. About a year ago, I went to New Mexico and went to a Smith's in Los Alamos, and they had the same signs that Kroger has with the cartoon people. But this Smith's was weird, because people marched in lockstep instead of dancing all around.

[US 89]

I actually don't think this will change much in Utah as Albertsons has very little in the way of market share. Their only presence in northern Utah is that they own Lucky, which has a handful of locations around Salt Lake. Almost all the Albertsons locations in Utah were sold off to Salt Lake City-based Associated Food Stores several years back, who turned them into Fresh Markets (about half are still open). The only remaining Albertsons in the state are two locations in the St George area, and I don't think we ever had any Safeways to begin with.

Meanwhile, Kroger owns Smith's, which is also based in SLC and is probably the biggest player in Utah's grocery store market.