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BELLINGHAM, Wash. — Regional grocer Haggen Inc., which has been struggling since expanding into California via the acquisition of 146 Albertsons and Safeway stores, has filed for chapter 11 bankruptcy protection.
Regional grocer Haggen Inc., which has been struggling since expanding into California via the acquisition of 146 Albertsons and Safeway stores, has filed for chapter 11 bankruptcy protection.
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The move came a week after the company filed a lawsuit against Albertsons LLC and Albertsons Holdings LLC, seeking more than $1 billion in damages. Haggen alleges that following its December 2014 acquisition of 146 Albertsons and Safeway stores, Albertsons engaged in "coordinated and systematic efforts to eliminate competition and Haggen as a viable competitor in over 130 local grocery markets in five states," and "made false representations to both Haggen and the FTC about Albertsons’ commitment to a seamless transformation of the stores into viable competitors under the Haggen banner," according to the lawsuit.
Albertsons had previously sued Haggen for allegedly not paying for merchandise acquired with the stores.
Albertsons had sold the stores to Haggen in order to win clearance from the Federal Trade Commission for its acquisition of Safeway Inc., which was completed in January.
The deal transformed Haggen from a regional chain with 18 stores in Washington and Oregon into a company operating mainly in California but also in Nevada and Arizona, where consumers were unfamiliar with the banner.
Haggen has struggled to win over consumers in the new markets, and in August the company announced plans to close 27 stores as part of what it described as a "right-sizing strategy."
