Chains have new owners; union threatens strike

06/30/2011 02:23:00 PM
Dan Gailbraith

LOS ANGELES — Two Southern California-based supermarket chains have come under new ownership during the past year, and the region’s three major chains faced the possibility of a labor strike as summer got under way.

Commerce-based Smart & Final Inc., owned by Apollo Management LP, a private equity firm, sold its Henry’s Farmers Market group to Phoenix-based Sprouts Farmers Markets LLC in April.

Henry’s stores are located throughout Southern California, while Sprouts has about 100 stores in Arizona, Colorado, Texas and California that offer a wide range of natural and organic foods. Sprouts also operates some stores in Texas under the Sun Harvest Farmers Market name.

Sprouts reportedly will have $1 billion in annual sales and about 7,000 employees.

It also could have as many as 200 stores within three to four years, many in Northern California as well as in Ventura, Santa Barbara, the Central Coast and the Inland Empire, east of Los Angeles, said Dick Spezzano, president of Spezzano Consulting Services, Monrovia.

“They seem to do well no matter where they go,” he said.

All locations eventually will operate under the Sprouts Farmers Market banner.

The stores were expected to start shipping out of the former Stater Bros. distribution center in Riverside, Calif., starting this summer, Spezzano said.

Both companies, though separately owned, were established by the Henry Boney family of San Diego, which will manage the new company. Apollo Management Group is the majority owner.

Last fall, Eden Prairie, Minn.-based Supervalu Inc. sold its 14-store, Carson, Calif.-based Bristol Farms division to Bristol Farms management and Endeavour Capital, an investment firm experienced in grocery and retail businesses.

The company reportedly has about 1,500 employees and does more than $200 million a year in sales.

Supervalu picked up the Bristol Farms division in 2006 when it acquired the Alberstons chain.

Spezzano said Supervalu trimmed personnel and improved Bristol Farms’ bottom line before selling the chain at a “significant discount” from what Albertsons paid for it.

Health care remained a sticking point early this summer as United Food and Commercial Workers Local 770 negotiated with Southern California Ralphs, Vons and Albertsons supermarkets on behalf of 62,000 unionized grocery store workers.

“We’re so far apart, if something doesn’t happen soon, we will have a strike,” Rick Icaza, union president, said at a June 9 news conference.


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