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Will Haggen Successfully Restructure Around its Remaining  Core Stores ?

Will Haggen Successfully Restructure Around its Remaining "Core Stores"?


BELLINGHAM, WA
Tuesday, September 15th, 2015

It’s been a busy year of twists and turns for Haggen, beginning with a large acquisition that increased its stores 10 fold and coming to the end with both a bankruptcy filing and a billion dollar lawsuit.

So many transitions have left a number of speculations in the chain’s wake, including questions about where it will go from here.

Photo Source: Merlone Geier Partners

Oregon Live reports that documentation from Haggen indicates that it will reorganize around 18 core stores that Alvarez & Marshal, a consulting firm the chain had hired, found to be profitable.

Shortly after these core stores were declared to have a strong brand reputation in their respective areas, the company announced its plan to shutter 27 stores that were not on that list.

Photo Source: Puget Sound Business Journal

For the employees that will lose their positions with these closures, Haggen stated it intends to pay them as quickly as possible through normal payment methods. “Fast pay” laws, however, which usually require payment immediately or within a few days, was declared “unworkable” by the chain, according to Oregon Live.

As to the company’s future plans, the documents indicate that the chain could be planning to sell the core profitable stores as one group after reorganizing around them, according to the report. This is still just speculation, however, as Haggen has not yet revealed anything definitive on closing any more stores.

Photo Source: Merlone Geier Partners

As we reported previously, it was announced that the company had filed for a Chapter 11 bankruptcy just after having filed a $1 billion lawsuit against Albertsons, as well as the intent to sell nearly 30 stores. The court permitted it to continue with selling those stores, but Oregon Live noted Haggen will most likely be required to get approval on any future store sales from the court as well.

DeliMarket News will continue to follow the chain’s plans as they unfold, as well as all other relevant retail news within the industry, so stay tuned.

Haggen