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Public ( NYSE : ABS )
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Helping Make Your Life Easier
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1939
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Grocery Store
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Boise, Idaho
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Larry Johnston, CEO & Director<br \> Felicia Thornton , CFO & Exec VP
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241,000
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Retail (Grocery)
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Acme , Acme Express , Albertsons Express , Bristol Farms , County Line Liqour , Grocery Warehouse , Jewel , Jewel Express , Jewel-Osco , Lazy Acres , Max Foods , Osco Drug , Sav-on Drug , Shaw's , Star Market , Super Saver
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$38897 billion USD ( 2004 )
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() is a .
Albertsons also operates stand-alone drug stores under the banners of
Osco Drug and
Sav-on Drug . At many of the Albertsons family of stores that include pharmacies, the Osco and Sav-on brand names are used along with the name of grocery store. Such examples are Albertsons-Osco, Albertsons-Sav-on, Jewel-Osco, Acme-Sav-on and Shaw's-Osco. In March 2005, Albertsons re-introduced the Osco brand name to the New England region by way of its
Shaw's and
Star Market pharmacies.
Albertsons operates more than 2,500 stores in 37 states and approximately 230,000 associates. It is ranked number four in sales by ''
Supermarket News '' — behind
Wal-Mart ,
Kroger and
Costco . Only Kroger has more stores.
Albertsons was founded by
Joe Albertson in 1939 in
Boise, Idaho , USA. An ad in the ''
Idaho Statesman '' touted Joe Albertson's first store as "Idaho's largest and finest food store." The store was filled with perks that, at the time, were brand new: free parking, a money-back guarantee, even an ice cream shop. The store was located at 17th and State Streets in downtown Boise.
In 1969, it partnered with
Skaggs Companies, Inc. to create the first combination grocery/drug store. Later, Albertsons acquired Seessel's, Smitty's, Super One Foods, Buttrey Food and Drug, and Bruno's.
A predescessor company to Albertsons, The Jewel Companies, Inc., based in Melrose Park, Illinois, merged with American Stores Company in 1984. Prior to Jewel's hostile takeover by American Stores, Jewel Companies operated Jewel Food Stores, Osco Drugs, Jewel-Osco, Eisner Food Stores, Buttrey Food and Drug, Sav-on Drugs, Star Markets, Crest photo lab and
White Hen Pantry among its many operations. In 1994, Star Markets (then owned by American Stores Company) was sold to Investcorp. In 1998, Investcorp sold Star Markets to
Shaw's Supermarkets with the sale completed in 1999. Jewel had experimented with many formats through its long and storied history, including two deep discount formats, one named Budget with stores in Schaumburg and Crystal Lake, Illinois, and another named Magna with one store located in Rockford, Illinois. During the 1970's, Jewel operated a forerunner to today's superstore format using the name Jewel Grand Bazaar. Jewel also operated Turn-Style department stores. When Jewel disposed of Turn-Style, Venture Stores acquired many of the former Turn-Style locations. Jewel is best known for pioneering the first Jewel-Osco "combo" store in 1962. Today, the "combo" store format is used by Albertsons throughout many of its divisions.
In 1999, Albertsons acquired American Stores Company, which included the chains Acme, Jewel-Osco, Lucky, Osco Drug and Sav-on Drugs. The Lucky stores were converted to Albertsons in November 1999 and the Lucky brand name was retired.
In 2001, Albertsons sold its free-standing Osco stores in the northeastern states to
Jean Coutu Group , a Canadian drug store company. Those stores were rebranded as Brooks Pharmacy after the sale was completed in January 2002.
Albertsons exited the
San Antonio ,
Texas , market in April
2002 by closing its 20 remaining area stores after already shuttering three other stores in December
2001 . Albertsons was the area's second top grocer to market innovator
H-E-B . At the time of the withdrawal, the 44-store H-E-B chain held a commanding 61 market share, while Albertsons held a 15 market share. Albertsons was the area's third top grocer before
Kroger exited the market in mid-1993 when it closed its 15 area stores. Then, H-E-B's 37 area stores held a 43.2 market share, Kroger's 15 area stores a 13.7 share, and Albertsons' 10 stores a 13.1 share.
In 2004, Albertsons acquired Shaw's Supermarkets.
On
January 23 ,
2006 ,
Supervalu ,
CVS/pharmacy , and an investment group led by
Cerberus Capital Management announced they had agreed to acquire Albertsons for $17.4 billion in cash, stock and debt assumption. Once approved, the company's retail stores would be divided as follows:
- Supervalu will acquire 1124 stores, including all Acme , Bristol Farms , Jewel , Jewel-Osco , Lazy Acres , Save-A-Lot (those operated by Shaw's ), Shaw's , Star Market , and Albertsons, Max Foods and Super Saver stores located in the Intermountain, Northwest and Southern California (including southern Nevada) regions and the rights to the Osco Drug and Sav-on Drug brand names;
- Supervalu will also acquire 11 distribution centers, 722 in-store pharmacies and 107 fuel centers.
- Upon close of sale, Supervalu will divest two Jewel-Osco stores in Springfield, Ill. to Cerberus;
- CVS will acquire all (approximately 700) of the stand-alone Osco Drug and Sav-on Drug stores in the Midwest, Southwest, Southern California and Nevada, and a warehouse located in La Habra, Calif., rebranding them all as CVS/pharmacy ; and
- The Cerberus-led group will acquire 655 Albertsons, County Line Liquor , Grocery Warehouse , Max Foods and Super Saver stores in the Dallas-Fort Worth, Florida, Northern California (including Northern Nevada), Rocky Mountain and Southwest regions. Upon close of sale, Cerberus will acquire two Jewel-Osco stores in Springfield, Ill., from Supervalu. Cerberus will have one year in which to sell the two stores, with 80 percent of the proceeds paid to Supervalu.
The agreement also includes terms for dividing up distribution centers and other real estate and support operations, as well as the sale of 26 Chicago-area
Cub Foods from Supervalu to the investor group. Since Cerberus has taken control of the
Cub Foods locations, Cerberus has annnounced that four locations (Algonquin, Bedford Park, Chicago and Naperville) will be closed by June 24, 2006.
After the acquisition closes in summer 2006 Albertsons will continue to exist as a brand used by both Supervalu and the Cerberus-led investor group.
Albertsons is increasingly progressive in the area of technology, recently adding a "check out while you go" system, where shoppers can scan items as they shop, and quickly pay before leaving.
Albertsons also allows (in certain areas) customers to shop from home via the company's website,
www.albertsons.com . Pickups can be arranged at the store, or the items may be delivered to the customer's home. In areas where this program is in effect, it is widely advertised over
Television and
Radio by corporate
Spokeswoman Patricia Heaton .
Albertsons has contracts with the
United Food And Commercial Workers (UFCW), the largest grocery
Union in the United States. In late 2003 and early 2004, Albertsons, along with competitor
Ralphs (owned by
Kroger ),
Locked Out its workers who were members of the UFCW in
Southern California , in sympathy with competitor
Vons (owned by
Safeway ), whose UFCW workers were
On Strike . The issues in contract negotiations included health care benefits and wage structure. The UFCW lost its bid to keep its benefit and wage language in the contract intact, a reflection of how Albertsons management sees the developing
Wal-Mart Supercenter (Wal-Marts with a grocery component) situation in Southern California. At present, starting wages and benefits given to new Albertsons employees are reportedly lower than those of employees hired before the labor dispute. Employee approval continues to decline with the increasing distance in associate and corporate relations (as of
2006 ).
As part of the 1999 merger with
American Stores , Albertsons acquired the Osco brand name. The root of this chain is
Skaggs , which was founded in
American Falls, Idaho in 1915. Osco stands for "Owners Service Company". The first Osco store, located in Rochester, Mn., opened in 1937. The Jewel Companies, Inc. acquired Osco in 1961. In 1980, Jewel acquired southern California-based Sav-on Drug Stores.
