Hi everyone, I'm new here. I've been interested in the history of grocery stores for a while, but I just found these boards recently. Nice to know that there are others with similar interests/fascinations.
Anyway, I have a question that I was hoping someone could clarify. From my understanding, American Stores bought over Lucky in California and Nevada in the '80s, but the CA attorney general objected to the deal, ordering a divestiture, since he felt that it would be anticompetitive. The case reached the supreme court (California v. American Stores Company, 492 U. S. 1301 (1989)) which sided with the attorney general and said that American Stores had to divest. So then what happened? We all know that American Stores did take over the Lucky chain. The US supreme court is the highest court and cannot be overruled. So how did this merger go through?
Any clarification would be appreciated.
Lucky/American Stores merger
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Groceteria
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Re: Lucky/American Stores merger
Only certain stores had to be divested. To oversimplify, American eventually ended up selling off most of its Alpha Beta stores in Southern California and a few scattered stores in Northern California.
Chad or one of the other SoCal experts can probably clarify better than I can, but I think I have some material on this too, somewhere, and I'll drag it out when I have a little more time and a little less work.
Chad or one of the other SoCal experts can probably clarify better than I can, but I think I have some material on this too, somewhere, and I'll drag it out when I have a little more time and a little less work.
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runchadrun
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Re: Lucky/American Stores merger
There was a brief discussion of this over on this thread http://www.groceteria.com/board/viewtop ... f=27&t=677 if you look on the 3rd page.
A small number of Socal Alpha Betas and pretty much all of the Norcal Alpha Betas were converted to Lucky. In Socal, 152 Alpha Betas and 9 Luckys were sold to Yucaipa.
A small number of Socal Alpha Betas and pretty much all of the Norcal Alpha Betas were converted to Lucky. In Socal, 152 Alpha Betas and 9 Luckys were sold to Yucaipa.
Re: Lucky/American Stores merger
Yup!Groceteria wrote:Only certain stores had to be divested. To oversimplify, American eventually ended up selling off most of its Alpha Beta stores in Southern California and a few scattered stores in Northern California.
Chad or one of the other SoCal experts can probably clarify better than I can, but I think I have some material on this too, somewhere, and I'll drag it out when I have a little more time and a little less work.
American owned Alpha-Beta, yet really wanted LUCKY.
They sold the Alpha-Beta sites, and assumed ownership of LUCKY.
Alpha-Beta was acquired by Yucaipa Stores, which ultimately sold 'em to Ralphs...which was acquired by Kroger.
LUCKY was ultimately acquired by Albertsons. Albertsons was sold last year between Cerebus and SuperValu.
Did I miss anything?! :)
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runchadrun
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Re: Lucky/American Stores merger
Here's a more detailed version of what happened in court:
American Stores bought Lucky in June, 1988. for $2.5 billion. In August the FTC approved the merger under the condition that ASC sell 37 stores. In September California, Attorney General John van de Kamp (who is a member of the bakery family) sued to block the merger. This was one of the first (if not the first) times a state sued to enforce federal antitrust laws. On 9/29/1988 a US District Court judge issued a preliminary injuction in favor of the state using federal antitrust laws, thus halting the merger. The 9th Circuit reversed the ruling but kept the injunction in place while it was appealed to the Supreme Court.
Meanwhile in November 1989 a settlement was reached that allowed 23 of the 36 stores north of SLO, Kern, and San Bernardino Counties to be renamed Lucky. The remaining 13, in Contra Costa, Monterey, San Mateo, Santa Clara, and Alameda Counties, were to be sold. The 23 stores accounted for only 4% of the combined chain's sales. This didn't affect the suit before the Supreme Court, which continued.
In April 1990 the US Supreme Court unanimously ruled that the state had the right to use federal antitrust law to block mergers. That sent the case back to the lower court. 3 weeks later American Stores agreed to sell 161 stores within 5 years to end the legal battle. In June 1991 ASC sold its interest in Alpha Beta to Yucaipa for $251m. As part of the deal the Attorney General approved the conversion of 15 Alpha Betas in San Diego County to Lucky for a total of 48 Lucky stores in the county.
American Stores bought Lucky in June, 1988. for $2.5 billion. In August the FTC approved the merger under the condition that ASC sell 37 stores. In September California, Attorney General John van de Kamp (who is a member of the bakery family) sued to block the merger. This was one of the first (if not the first) times a state sued to enforce federal antitrust laws. On 9/29/1988 a US District Court judge issued a preliminary injuction in favor of the state using federal antitrust laws, thus halting the merger. The 9th Circuit reversed the ruling but kept the injunction in place while it was appealed to the Supreme Court.
Meanwhile in November 1989 a settlement was reached that allowed 23 of the 36 stores north of SLO, Kern, and San Bernardino Counties to be renamed Lucky. The remaining 13, in Contra Costa, Monterey, San Mateo, Santa Clara, and Alameda Counties, were to be sold. The 23 stores accounted for only 4% of the combined chain's sales. This didn't affect the suit before the Supreme Court, which continued.
In April 1990 the US Supreme Court unanimously ruled that the state had the right to use federal antitrust law to block mergers. That sent the case back to the lower court. 3 weeks later American Stores agreed to sell 161 stores within 5 years to end the legal battle. In June 1991 ASC sold its interest in Alpha Beta to Yucaipa for $251m. As part of the deal the Attorney General approved the conversion of 15 Alpha Betas in San Diego County to Lucky for a total of 48 Lucky stores in the county.
Re: Lucky/American Stores merger
Bit on the topic on wikipedia:
http://en.wikipedia.org/wiki/American_Stores
Still have my LUCKY model-sized delivery truck...with the American Stores logo on the driver's door!
http://en.wikipedia.org/wiki/American_Stores
Still have my LUCKY model-sized delivery truck...with the American Stores logo on the driver's door!
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luckysaver
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Re: Lucky/American Stores merger
As part of the settlement with the Federal Government, American Stores had to sell or close the following:
- the entire Alpha Beta division (Alpha Beta, Skaggs Alpha Beta, Hy-Lo/Skaggs Drugs)
- selected Lucky stores and the non-food assets of Lucky Stores Inc
- Rea & Derrick Inc (northwest drug chain)
- Buttrey Food and Drug Inc (Montana based grocery/in-store pharmacy)
- a few Jewel, Acme, Savon Drugs, Star Market, and Osco Drug stores
It is interesting to note that in the mid 1990's, Albertsons would absorb Buttrey F/D and a few years later acquire American Stores. Their relationship started with Albertsons partnering with Skaggs Drug Centers. Its all in the family!
luckysaver
- the entire Alpha Beta division (Alpha Beta, Skaggs Alpha Beta, Hy-Lo/Skaggs Drugs)
- selected Lucky stores and the non-food assets of Lucky Stores Inc
- Rea & Derrick Inc (northwest drug chain)
- Buttrey Food and Drug Inc (Montana based grocery/in-store pharmacy)
- a few Jewel, Acme, Savon Drugs, Star Market, and Osco Drug stores
It is interesting to note that in the mid 1990's, Albertsons would absorb Buttrey F/D and a few years later acquire American Stores. Their relationship started with Albertsons partnering with Skaggs Drug Centers. Its all in the family!
luckysaver