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BELLINGHAM, Wash. — Haggen Inc., which has been struggling to digest its acquisition of 146 Albertsons and Safeway stores earlier this year, is closing 27 stores in California, Arizona, Nevada, Oregon and Washington.
Haggen Inc., which has been struggling to digest its acquisition of 146 Albertsons and Safeway stores earlier this year, is closing 27 stores in California, Arizona, Nevada, Oregon and Washington.
The company says additional stores will be sold or closed in the future as part of its right-sizing strategy.
"Haggen’s goal going forward is to ensure a stable, healthy company that will benefit our customers, associates, vendors, creditors, stakeholders as well as the communities we serve," said Bill Shaner, Haggen’s chief executive officer for the Pacific Southwest. "By making the tough choice to close and sell some stores, we will be able to invest in stores that have the potential to thrive under the Haggen banner."
Through the acquisition, Haggen expanded from 18 stores with 16 pharmacies and 2,000 employees in the Pacific Northwest to 164 stores and 106 pharmacies employing more than 10,000 people in Washington, Oregon, California, Nevada and Arizona. Haggen’s original stores continue to perform well, the company says.
But Haggen has struggled in California and other new markets, where it faces intense competition and a population of consumers that are not familiar with the banner. It also has had to contend with other challenges. Late last month the United Food and Commercial Works Local 770, based in Los Angeles, filed official complaints against Haggen, Albertsons and Vons, claiming that recent layoffs and reductions in worker hours violate contractual agreements.
And in July, Haggen was sued by Albertsons, which alleged that Haggen refused to pay for $36 million in inventory at 32 stores it acquired. Albertsons claimed Haggen waited until its acquisition deal closed before stating that it would not pay for the inventory, a charge Haggen officials deny.