SALT LAKE CITY -- Albertsons grocery stores are going away in Utah, but not entirely. They'll be getting a new name and a new look along with a new owner, Associated Food Stores, Inc. The company has agreed to buy 36 under-performing Albertsons they hope to make profitable.
"Albertsons was not doing a real bad job to begin with, so I think we're just going to try to build upon the excellent platform that they put into place," says Rich Parkinson, president and CEO of Associated Food Stores, Inc.
Parkinson says it's not quite a done deal. "Right now, we've just entered into an agreement to purchase the stores," he says. "We still have to go through FTC approval." The deal is worth about $150 million and a decision is expected this fall.
Changes won't happen immediately either. It could take eight weeks to change the signs over and make transitions with uniforms and name tags.
Come fall, all but seven of the Albertsons in Utah will be something else. Still grocery stores, just with a new name and Western Family products.
"They'll obviously notice new signs, new logos," Parkinson says. "There probably won't be a great departure from what they've been doing, but an emphasis on other departments that we've had in our stores that we think they could benefit from."
And, what about the nearly 2,700 Albertsons employees? Parkinson says, "We're not contemplating any cutbacks. This will be a very seamless opportunity for these employees to work with a new organization that will value them as they have been valued, and create opportunities for them for their future."
Richard King, senior vice president of Associated Food Stores, Inc. says, "We're going to rely very heavily on the leaders of the stores today and their people to stay on with us. So, yes we need them and we want them."
The additional 36 Albertsons stores will more than double Associated Food Stores. There are currently just 22 corporate-owned stores operating under the Macey's, Dan's, Lin's, and Dick's Market banners, in addition to the 500 independent grocery stores the company services in the Intermountain West.
Parkinson and King admit it's a bit risky to buy under-performing stores in a bad economy, but they say it's a risk they're willing to take.
"We're excited to get in there and start working on them," says King.
The company hasn't decided on a new name yet.
Supervalu, the company that owns Albertsons now is looking for a buyer for two stores in Orem and two stores in West Jordan.
Three stores in Washington County were not offered in the deal.