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(Barron's)   Cerberus to buy Safeway, says it will develop plan to allow customers through the door   (blogs.barrons.com) divider line 26
    More: Misc, Safeway, supermarket chains, Wall Street Journal  
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673 clicks; posted to Business » on 06 Mar 2014 at 8:17 PM (37 weeks ago)   |  Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



26 Comments   (+0 »)
   
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2014-03-06 06:32:31 PM  
I am sure they will do for Safeway what they did for Chrysler.
 
2014-03-06 07:32:41 PM  
s3.amazonaws.com

Approves
 
2014-03-06 07:40:52 PM  
Cerebus?
watchplayread.com
 
2014-03-06 08:32:50 PM  

mr_a: I am sure they will do for Safeway what they did for Chrysler.


Cerberus didn't perform any miracles with Chrysler, but they did lay the groundwork for the current success that Fiat and Marchionne are getting all of the credit for.  Daimler bent Chrysler over a barrel and farked them with a broomstick sideways, Cerberus bought a complete mess.  It takes five or more years on average from idea to metal on the lot when it comes to new cars, so Cerberus had started some things in the right direction before they said 'fark it' and sold out.
 
2014-03-06 08:46:51 PM  
Their new check-out counters are fancy marble, here's a pic:allgeektomeblog.files.wordpress.com
 
2014-03-06 09:23:15 PM  
Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.
 
2014-03-06 09:39:07 PM  

Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.


I was wondering if Albertson's was still around

/all of them in my area were closed years ago as far as I know
//and agreed on the suckage
 
2014-03-06 09:48:05 PM  
Sunuvabeyatch, I shop at Safeway and like it.  Albertson's is expensive, there's no Ralph's near me, Sprouts is expensive, and Food4less is the Walmart of grocery stores.

dang

/ been shopping at Food4less lately anyway
// Bought a bike, Food4less is 3 miles away
/// Limits my grocery spending, no big-assed trunk to put stuff in
//// Except for your mom's trunk that is
 
2014-03-06 09:54:35 PM  

Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.


When I lived up north Safeway was OK, but that was about it.  Acme was better, and Safeway bought out and killed Genuardi's, which was the best of them all before that happened.
 
2014-03-06 09:58:33 PM  

TuteTibiImperes: mr_a: I am sure they will do for Safeway what they did for Chrysler.

Cerberus didn't perform any miracles with Chrysler, but they did lay the groundwork for the current success that Fiat and Marchionne are getting all of the credit for.  Daimler bent Chrysler over a barrel and farked them with a broomstick sideways, Cerberus bought a complete mess.  It takes five or more years on average from idea to metal on the lot when it comes to new cars, so Cerberus had started some things in the right direction before they said 'fark it' and sold out.


No they made it worse.  They pulled the crap people (wrongly) accused Romney of doing.  i.e. they bled it for cash by heaping it in debt then using that money to pay the equity firm gigantic sums of money all the while cutting out effectively all R&D and raiding anything they could to get cash out.  Then left it a hulk meanwhile not taking anything for a loss.  Fiat got the first chunk of equity for free since it was worth less than zero.  Marchionne pulled off what amounts to a miracle to revive it so quick.
 
2014-03-06 09:59:28 PM  

mr_a: I am sure they will do for Safeway what they did for Chrysler.


If the fire the current managment that would be a step in the wrong direction


Good grief safeway bought what was a nice grocery store chain in Houston and completely fubared it trying to make it compete with walmart for price by cutting all the quality out
 
2014-03-06 11:08:11 PM  

MaudlinMutantMollusk: Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.

I was wondering if Albertson's was still around

/all of them in my area were closed years ago as far as I know
//and agreed on the suckage


There used to be two in here in Auburn, WA (one even moved from an old location to a new one that was literally only a few hundred feet away), but the one on 15th and Auburn Way closed a few years back. The South Auburn one on A St. is still there, but way too far out of the way to warrant going there for jack. If I go out that far, there's a Haggen in the Lakeland Hills area and a Winco in the northern part of Sumner that are better options.

Also had a TOP Foods not far from the old north Auburn Albertsons that closed recently... Only places around me locally now are Fred Meyers, Safeway, a smaller chain, Red Apple (craaaap), and the Kent TOP Foods.
 
2014-03-06 11:15:05 PM  

brandent: TuteTibiImperes: mr_a: I am sure they will do for Safeway what they did for Chrysler.

Cerberus didn't perform any miracles with Chrysler, but they did lay the groundwork for the current success that Fiat and Marchionne are getting all of the credit for.  Daimler bent Chrysler over a barrel and farked them with a broomstick sideways, Cerberus bought a complete mess.  It takes five or more years on average from idea to metal on the lot when it comes to new cars, so Cerberus had started some things in the right direction before they said 'fark it' and sold out.

No they made it worse.  They pulled the crap people (wrongly) accused Romney of doing.  i.e. they bled it for cash by heaping it in debt then using that money to pay the equity firm gigantic sums of money all the while cutting out effectively all R&D and raiding anything they could to get cash out.  Then left it a hulk meanwhile not taking anything for a loss.  Fiat got the first chunk of equity for free since it was worth less than zero.  Marchionne pulled off what amounts to a miracle to revive it so quick.


  As a person who works in a company with close ties to many of Cerberus' previous forays into the grocery chain segment, I can confirm that Safeway is about to have a very bad time.  Cerberus went in about 10 years ago to gut Albertson's and tricked Supervau into making a massive strategic error by buying all the Albertson's Cerberus didn't want.  Cerberus spent the next few years gutting Albertson's LLC with LBO style asset sales or sale lease back transactions and turned poor Albertson's LLC into a real estate portfolio.  Most of Albertson's LLC distribution ended up coming from Supervalu or C&S Wholesale so Albertson's had no leverage to negotiate transport prices. All the while, Cerberus bled Albertson's LLC for cash through "operational efficiencies"; which were fairly evident in the run down and understaffed locations that had a hard time competing via selection and price.

 While Cerberus was doing its thing on Albertson's LLC, Supervalu was trying to figure out wtf to do against Ralph's (Kroger) in California and they just couldn't figure it out.  So Kroger just kept cleaning Supervalu's clock every quarter and the company started hemorrhaging cash flow with one bad promotion idea after another. About $3 Billion in goodwill write offs and a few large stock price haircuts later, Supervalu threw in the towel and let Cerberus take them out. So now Supervalu is basically some off brands with Sav-A-Lot as its primary business (think General Dollar with more groceries).  Cerberus gets all the previous Albertson's it didn't buy in the first takeover round and is doing its usual routine as we speak.

  If Cerberus is going to take out Safeway, it means its trying to keep the real estate asset shuffling system going. Safeway owns a lot of property and Cerberus is an outfit that loves the whole LBO/sales lease back system. Plus, Safeway is flush with cash and has very little goodwill on the books so its like M&A candy.  M&A guys love this kind of transaction cause all the cash instantly gets discounted off the enterprise value and there is very little risk of large goodwill write offs blowing up their assumptions.  Once the transaction is complete, they cash sweep the existing cash off the balance sheet via loans they syndicate to Safeway.  Thus, they get all the cash off the books, get continuous income streams from the leverage and gobble up large "management advisory fees" on the back end.  I feel really bad for all the front line employees at Safeway cause they are about to get reamed.
 
2014-03-07 12:10:20 AM  

loonatic112358: mr_a: I am sure they will do for Safeway what they did for Chrysler.

If the fire the current managment that would be a step in the wrong direction


Good grief safeway bought what was a nice grocery store chain in Houston and completely fubared it trying to make it compete with walmart for price by cutting all the quality out


Safeway just killed off one of the iconic Chicago-area grocery chains a couple of months ago since they essentially tried the same thing over the last decade. Now the guy who was president (but not owner) of the company during the transition over to Safeway (and was forced out by Safeway) is now the owner of the grocery chain expected to fill the void left by Safeway.

/he who laughs last laughs best
 
2014-03-07 12:12:47 AM  
Here's another amusing little Safeway tidbit: linkage
 
2014-03-07 12:19:28 AM  

Jiggatron69: brandent: TuteTibiImperes: mr_a: I am sure they will do for Safeway what they did for Chrysler.

Cerberus made it worse.


I resigned my cake-walk management position with Albertsons about six months after Cerberus took over.  They were essentially doing all the absolutely abysmally stupid crap Supervalu was doing, but with far more ferocity in its implementation.  My store went from being one of the only successful stores in the non-Portland, Oregon market (a status which we had held because of the extreme autonomy that SVU had granted us towards the end once they admitted they didn't know what they were doing) to an under-performer.  The morale of every employee in every store has gone down.  Prices remained stagnant.  And those of us that did see how badly we were being shafted had to deal with ever-increasing levels of cognitive dissonance.

 The good news is that it drove several intelligent individuals that were holding on to comfortable jobs who could do better to attempt to do so.  The bad news is everyone that didn't is suffering as a result.
 
2014-03-07 12:58:34 AM  

Bazzlex001: Jiggatron69: brandent: TuteTibiImperes: mr_a: I am sure they will do for Safeway what they did for Chrysler.

Cerberus made it worse.

I resigned my cake-walk management position with Albertsons about six months after Cerberus took over.  They were essentially doing all the absolutely abysmally stupid crap Supervalu was doing, but with far more ferocity in its implementation.  My store went from being one of the only successful stores in the non-Portland, Oregon market (a status which we had held because of the extreme autonomy that SVU had granted us towards the end once they admitted they didn't know what they were doing) to an under-performer.  The morale of every employee in every store has gone down.  Prices remained stagnant.  And those of us that did see how badly we were being shafted had to deal with ever-increasing levels of cognitive dissonance.

 The good news is that it drove several intelligent individuals that were holding on to comfortable jobs who could do better to attempt to do so.  The bad news is everyone that didn't is suffering as a result.


I'm sorry it ended up that way for you and many of your coworkers.  I sat in a lot of the strategic vendor discussions and one off advisory meetings Supervalu and albertsons held with my company.  I tried to present ideas that would help turn things around for you guys but nobody up top wanted to hear it because it went against cash flow preservation.  I actually made quite a few enemies among senior management because of this so go figure.  They didn't want to hear anything about increases in sg&a or capex and just kept pushing the Cerberus management advice of random uncompetitive "price investments".  I watched them gut your workforce like it was some brilliant plan.  I kept telling them having a bunch of demoralized employees working run down stores would not work but nope I got labeled a "socialist". I'm about to quit this job after so many years of butting heads with senior management.  Tired of watching a bunch of morons burn companies to the ground and act like they are JPMorgan reborn.
 
2014-03-07 01:33:48 AM  
As long as they do something about the Von's near me. 3 month old pork loin and moldy portobello mushrooms are far too common.
 
2014-03-07 05:59:50 AM  

Iczer: MaudlinMutantMollusk: Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.

I was wondering if Albertson's was still around

/all of them in my area were closed years ago as far as I know
//and agreed on the suckage

There used to be two in here in Auburn, WA (one even moved from an old location to a new one that was literally only a few hundred feet away), but the one on 15th and Auburn Way closed a few years back. The South Auburn one on A St. is still there, but way too far out of the way to warrant going there for jack. If I go out that far, there's a Haggen in the Lakeland Hills area and a Winco in the northern part of Sumner that are better options.


I live near the South Auburn one and you're not missing anything. Place is a bit of a dump. Or at least run down, and the prices are pretty bad. I only go there when I have to. Much prefer taking the bus the extra mile or two to go to Safeway or Fred Meyer. Much cleaner, well maintained stores.
 
2014-03-07 07:34:29 AM  
The only complaint I have about where I am living now is the groceries are terrible. We have two Kmarts, but can't get a place with decent produce. I miss Meijers.
 
2014-03-07 07:37:32 AM  

loonatic112358: mr_a: I am sure they will do for Safeway what they did for Chrysler.

If the fire the current managment that would be a step in the wrong direction


Good grief safeway bought what was a nice grocery store chain in Houston and completely fubared it trying to make it compete with walmart for price by cutting all the quality out


It is pretty impressive how throroughly they broke Randall's, which was the nicest grocery store that wasn't stupid (i.e. Rice Markets) when I was a kid, into the shuttering crapfest it is now.

I thought grocery stores in Philadelphia were way worse when the only halfway good one nearby was Genuardi's, another Safeway brand, and SuperValue and ACME turned out to be complete garbage, but then Giant bought all the Genuardis.
 
2014-03-07 12:03:48 PM  

YixilTesiphon: loonatic112358: mr_a: I am sure they will do for Safeway what they did for Chrysler.

If the fire the current managment that would be a step in the wrong direction


Good grief safeway bought what was a nice grocery store chain in Houston and completely fubared it trying to make it compete with walmart for price by cutting all the quality out

It is pretty impressive how throroughly they broke Randall's, which was the nicest grocery store that wasn't stupid (i.e. Rice Markets) when I was a kid, into the shuttering crapfest it is now.

I thought grocery stores in Philadelphia were way worse when the only halfway good one nearby was Genuardi's, another Safeway brand, and SuperValue and ACME turned out to be complete garbage, but then Giant bought all the Genuardis.


Thankfully HEB has filled the void the farktards at safeway made


Rice has made their own fubar, we'll have to see how sprouts does with taking over the old ricce locations


/I'd love to see Fiesta do something, they've gone stagnant
 
2014-03-07 02:46:53 PM  

Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.


The Albertson's in this area were nice, well lit, well stocked, with a friendly staff. Then the Cerberus conversion started and they all went from nice to suck.

BUT even then they were still better than the local Safeway's. They are all dirty, dingy, they have crap in the aisle all the time, their selections suck and their employees are some of the surliest people I have had the misfortune of dealing with.

Raley's/Bel Air > Safeway by a long shot. I would prefer Trader Joe's (yeah yeah, I know) but the closest one to me is 20 minutes and a bridge toll away.
 
2014-03-07 03:09:12 PM  
Pff.  It'll end up like every other experiment they were ever involved in:  the entire research team will be indoctrinated and will die horribly.
 
2014-03-07 06:27:37 PM  

TuteTibiImperes: Incontinent_dog_and_monkey_rodeo: Crap. Crap. Crap.  I like Safeway the way it is, Albertson's sucks.

When I lived up north Safeway was OK, but that was about it.  Acme was better, and Safeway bought out and killed Genuardi's, which was the best of them all before that happened.



Hello fellow southeastern PA'er! Genuardi's was absolutely awful after Safeway took it over. Genuardi's prices were always high, but at least there was a quality aspect to go along with it, and their stores were ahead of the game before Safeway. Safeway butchered it into mediocrity...and allowed Wegmans and smaller specialty grocers to move in and ruin them. Apparently there is still one Genuardi's location operating for some odd reason....maybe it will become an Acme now. (Acme under Cerberus has really stepped up their game..when they were owned by SuperValu, they were pretty much dead.)

/I briefly worked at a Giant store that was a former Genuardi's. Manager informed me that since it became a Giant, sales in just one department were more than double.
/Giant isn't really much better, but whatever...I no longer work in the grocery business.
 
2014-03-07 11:16:57 PM  
Remember, Wall Street thinks you're all "useless eaters" anyway.
 
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