Save Mart Supermarkets will be much bigger, about twice its current size, with the acquisition of 132 Albertsons stores in northern California and northern Nevada.
Many of the stores involved in the deal are former Lucky supermarket locations and, while those units fared poorly after becoming Albertsons, at least one analyst, Burt Flickinger III, managing director of Strategic Resource Group, sees a different scenario playing out this time around.
"Save Mart is very much like Lucky. It's competitively priced," he told the San Jose Mercury News. "Even though the market is consolidating, this deal will increase competition and make stores better... It's certainly better for competition. Albertsons had run a weak division for at least five years and maybe ten years."
With the acquisition of the Albertsons stores, Save Mart will now become the number two grocery store operator in Northern California behind Safeway. Currently, the company operates 75 stores under the Save Mart banner and another 44 warehouse-style Food Maxx stores. Five other locations operate as S-MART.
Bob Piccinni, chairman and CEO of Save Mart, said the company is looking for a smooth transition. "It is my hope and expectation that Donna Robbins (president of Albertsons Northern California Division) will continue to be a part of the new organization going forward with minimal disruption to current operations. Save Mart will embrace and learn from the current operations of these new stores, implementing the best practices of both organizations and making our entire chain of stores a superior shopping experience for all our valued customers," he said in a released statement.
Discussion Question: What are you expecting from Save Mart's acquisition 132 Albertsons?