A bankruptcy court has approved Gelson’s bid to purchase six Southern California stores, including one in Santa Monica.
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The Hall Boulevard location will be the first 99 Ranch Market in Oregon.
Before the suit, Albertsons accused Haggen of fraud for failing to pay $41 million for inventory it acquired in the new stores. The Sherwood location is expected to close December 8.
Haggen has one other store in Eugene that had not been part of last week’s auction. “For the remaining stores that have not been sold, we know this brings great stress and uncertainty to our members and their families”. Haggen plans to submit the results of the auction for approval to the Bankruptcy Court at a November 24 hearing. “Despite the filing, Haggen does not anticipate any changes to continuing operations at the Core Stores including regular payments to suppliers and partners”.
Another big victor amid Haggen’s collapse is Boise grocer Albertsons – the very company that fueled Haggen’s overly ambitious expansion by handing over almost 150 stores when it merged with Pleasanton’s Safeway Inc. Gelson’s did not disclose the terms of the agreement, but earlier court documents priced the bid for eight stores at $36 million.
The company filed for Chapter 11 bankruptcy protection and estimated it could save $57.4 million for the rest of the fiscal year and make an additional $125.6 million by liquidating the stores, the Los Angeles Times reported.
All told, the company auctioned off 91 stores at last week’s auction.
They include three stores in Arizona, four in Nevada, five in OR, 13 in Washington and 30 in California.
How Albertsons was able to purchase back its own stores is unclear.
It’s unclear as to how Albertsons would be allowed to buy back stores it initially had to shed as part of Cerberus Capital’s acquisition of Safeway. But the FTC in September approved a request by Albertsons that allowed the grocery chain to rehire employees who had transferred to Haggen.
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Officials with the FTC and Albertsons could not be reached for comment Monday.
