Haggen will sell 29 of its core stores – including five in Whatcom County – to Albertsons, pending court approval.
That’s almost all of the bankrupt company’s remaining stores, but the Haggen brand name won’t disappear. Fifteen stores purchased by Albertsons will carry on the name and continue to be operated from Haggen’s Bellingham headquarters, according to a March 14 press release from the company.
Stores that will retain the Haggen banner include 14 locations that predate the company’s failed expansion into the Southwest and one recently converted location in Oak Harbor, according to the news release.
Albertsons will pay a base amount of $106 million for the stores plus a “closing adjustment amount,” according to court documents.
A Haggen spokesperson wouldn’t say whether John Clougher would continue to lead Haggen as CEO, though Clougher was quoted in the company’s press release.
“We are excited about the opportunity to have the backing of Albertsons and look forward to being part of the Albertsons grocery family,” he said.
Haggen’s focus on sustainably sourced and locally produced products won’t change, according to the press release.
The other 14 stores in the deal will transition back to the Albertsons banner. Albertsons previously owned the stores, but sold them to Haggen in January 2015 to get Federal Trade Commission (FTC) approval on its merger with Safeway.
The U.S. Bankruptcy Court in Delaware that’s overseeing Haggen’s bankruptcy must approve the deal. A court hearing on the proposed sale is scheduled for March 29.
It’s possible that some of the stores’ landlords could object to the sales, as happened with a few Haggen stores sold at auction in the past year.
Albertsons didn’t buy all the remaining stores. A store in Oregon City, Oregon; stores in Port Angeles and Puyallup, Washington and Haggen’s pharmacy in Bellingham aren’t part of the deal. Haggen is seeking court permission to begin liquidation sales at some stores.
At least one union president thinks the sale to Albertsons will be positive for Haggen employees, who have awaited their fate as Haggen officials delayed an auction for remaining stores four times.
“This news will hopefully end the uncertainty for our members and our communities,” said Denise Jagielo, president of United Food and Commercial Workers (UFCW) Local 367, based in Tacoma. “Our members look forward to continuing their unparalleled dedication to the neighborhoods and their customers.”
The UFCW also represents Albertsons employees. Local union officials couldn’t be reached for interviews.
The sale is the final move in a series of events that started when the FTC ordered Albertsons to sell 164 stores throughout the western United States so its merger with Safeway wouldn’t hurt consumers by creating uncompetitive market conditions. Haggen bought 146 of those stores and quickly started losing money in them.
When Haggen went bankrupt in September 2015 and started selling stores at auction, Albertsons bought back some of the more profitable stores. Now, Albertsons is poised to acquire a package of profitable stores that its brands previously had to compete with, making Haggen’s demise a failure for the FTC.
The FTC said in a statement that it’s best for consumers if the 29 stores continue to operate as supermarkets, even if Albertsons owns them.
“While the divestitures did not lead to the full result we were looking for – a new supermarket competitor in each market area – most of the divested stores do remain supermarkets,” the statement said. “And it should also be noted that in a number of areas the stores are now being operated by other competitors.”