UFCW Local 5 Safeway Member Update
Safeway Confirms Sale to Cerberus
March 6, 2014
On Thursday March 6, Safeway confirmed it had signed an agreement to sell the chain to Cerberus, a private equity takeover firm based in New York City.
This is not the first time Cerberus has taken over a grocery company and not the first time they have done so in Northern California. In 2006 Cerberus bought Albertsons. The Cerberus era was not a good one for the employees of Albertsons. The investment firm mostly looked upon their acquisition as an opportunity to sell off stores sitting on valuable real estate. This policy resulted in many store closures, reductions in hours and layoffs. Cerberus eventually sold the remnants of the chain to SaveMart.
The sale announced today has not been completed. The agreement faces many challenges, not the least of which are anti-trust issues, where in markets like Los Angeles Safeway owns large numbers of Vons and Pavilions locations and Cerberus owns many Albertsons stores. If the agreement passes the government requirements it is anticipated to be wrapped up near the end of 2014.
During this interim period your contract remains in place along with your wages, benefits and working conditions. The new owner is obligated to bargain with the union to work through the effects of the sale on the members. We have dealt with similar issues when KKR purchased Safeway and during the multiple takeovers at Luckys, Andronicos and many other chains over the years.
According to a company press release, no stores are anticipated to close as a result of this merger. If they live up to that commitment, thanks to some of the best retail grocery workers in the business at existing Safeway stores, the transition will be smooth and the new company will thrive. Local 5 will work hard to assure such an outcome.
ABC 7 Coverage: http://abclocal.go.com/kgo/