[A tip of the hat to rialtus for alerting me to this.]
Another piece of supermarket history is passing away. Today, Albertsonsagreed to be sold to a consortium of Supervalu, CVS, and a CERBERUS-led consortium. What will the net effect of this be? Based on the press releases (Albertsons, CVS, Supervalu), here’s what I can figure out:
- SUPERVALU will acquire the operations (i.e., stores and distribution centers) of Acme Markets, Bristol Farms, Jewel-Osco, Shaw’s Supermarkets, Star Markets, and Albertsons banner stores in the Intermountain, Northwest and Southern California regions. SUPERVALU will also acquire the related in-store pharmacies under the Osco and Sav-on banners. As a result of the acquisition, which totals 1,124 stores, the new SUPERVALU will become the nation’s second-largest supermarket chain. It appears that Supervalu will retain the existing brand names, although the fate of Sav-on and Osco is unclear.
- CVS Corporation will acquire approximately 700 standalone Sav-on and Osco drugstores, as well as a distribution center located in La Habra, California, from Albertsons, Inc. These will be rebranded as CVS. The Sav-on and Osco banners are not part of the sale to CVS.
- The CERBERUS-led consortium will acquire 655 operating stores and 100 percent of the distribution centers and offices in Albertsons’ Dallas/Fort Worth division, and in the Florida, Northern California, Rocky Mountain and Southwestern regions. These stores operate under the Albertsons and Super Saver banners and also include the combo-store pharmacies under the Osco and Sav-on banners. Cerberus has also purchased 26 Cub Stores from SUPERVALU in the Chicago area for an undisclosed amount. The group plans to operate the stores under the Albertson’s name, and SUPERVALU would provide the necessary transition services to all consortium members for an unspecified length of time.
Why do I find this of interest? It’s the good old “What goes around comes around”.
Let’s start with CVS. In 1991, CVS did a major pullout of the Southern California market. Most of its stores became… Savon Express. Many were closed. Since it’s exit, Rite Aid bought 1,000+ Thrifty Payless stores in 1996. Walgreens now has approximately 50 stores in the L.A. market. Albertsons had more than 200 stores in greater L.A. Rite Aid has about 155. So this is a major return for CVS, perhaps an “In Your Face” to Savon.
Albertsons is more interesting. Albertsons used to be a very tiny player in the California market, especially in Southern California. For those that remember, there were once two chains: Lucky and Alpha Beta. Lucky began in San Mateo county. It expanded to the East Bay in 1935, and the Lucky name was first used at the Berkeley store on Shattuck Avenue in 1935. Originally, Lucky’s stores were clustered primarily in Oakland and other East By locations. Lucky grew by acquisition: Cardinal Stores (Sacramento), Big Bear (Seattle), Jim Dandy and Food Basket (Southern California), Kash and Karry (Florida), Eagle Country Markets (Illinois). Lucky also operated a chain of department stores called Gemco throughout the 1960s and 1970s. In 1988, Lucky unwillingly became a part of American Stores, along with Jewel-Osco in the midwest, Acme in the northeast, Buttrey Stores in the Rockies, and Alpha Beta, Food Basket, and Sav-on Drugs in Southern California. American Stores’ Alpha Beta units in northern California were re-branded as Lucky, while a number of the southern California Alpha Beta branches were sold to Yucaipa and ultimately merged into Ralphs when that chain was also acquired by Yucaipa. In 1998, Albertson’s purchased American Stores and became the second largest grocery retailer in the US; all Lucky stores were rebranded the following year.
So, here we have the stores being split again between Northern and Southern California… just like when American Stores bought Lucky.
What goes around comes around.
P.S. I intended this post as a measure of relaxation, after a day of having the hard disk fail on the work laptop, the graphics card fail on my work desktop, and an incredibly busy day. I didn’t count on NSS&F melting down when I got home, and having to write this with her having a temper tantrum in her room. It’s been one of those days.
