A Year of Upheaval in California Retailing
January--Vons Grocery management and other investors complete a $750-million leveraged buyout of the company from Household International. Throughout the year, the company launches a new store concept called Pavilion; agrees to buy Pantry Supermarkets, a chain of upscale stores, and announces plans for Tianguis, the first major Latino-oriented chain of a big U.S. food retailer.
February--HRT Industries announces the closing of 32 Zodys discount stores, eliminating 2,400 jobs.
February--Stater Bros., a regional supermarket chain, sets the stage for a bitter, months-long battle for control by suspending and suing its president and chief executive, Jack H. Brown. He regains control in June.
March--Boys Market, a 43-store regional supermarket chain, agrees to a buyout by management and a Los Angeles merchant banking firm. The deal is completed in April.
May--Jurgensen’s, a posh, 10-store grocery chain, agrees to a purchase by Old Dominion Financial Corp., but the deal falls through. In November, the company strikes a deal with Yucaipa Capital Corp., a private investment firm.
May--Thrifty Corp., operator of California’s largest drugstore chain as well as the Big 5 sporting goods stores, agrees to an $885-million takeover by Pacific Lighting, parent of Southern California Gas.
June--May Department Stores, parent of May Co. California, launches an effort to buy Associated Dry Goods, parent of J. W. Robinson, for $2.7 billion in stock. After weeks of fighting the takeover on antitrust and other grounds, Associated agrees to the combination in July.
July--After weeks of speculation, Dart Group launches a hostile tender offer for Safeway Stores. At month’s end, Safeway agrees to go private in a $4.1-billion buyout by Kohlberg Kravis Roberts, an investment firm.
August--American Stores announces a restructuring in which its Sav-on drugstores would be renamed Sav-on/Osco, with emphasis on the Osco, the company’s national drug chain.
September--New York investor Asher B. Edelman makes first of several bids for Lucky Stores. Lucky rebuffs him in favor of a restructuring that includes the closing of its Gemco membership discount department stores, the sale of many store locations to the Target division of Dayton Hudson, a repurchase of shares and the sale or spinoff of some specialty units.
October--May Department Stores completes its acquisition of Associated Dry Goods.
November--For the second time in 2 1/2 years, Carter Hawley Hale Stores, parent of the Broadway and Neiman-Marcus, becomes a target of the Limited, a specialty store company, which joins forces with an Ohio developer, Edward J. DeBartolo Sr. The new bid fails in December, as Los Angeles-based Carter Hawley announces plans to split into two companies--department and specialty stores.
December--Gemco stores are closed, eliminating 14,000 jobs. Lucky Stores wins shareholder approval to reincorporate in Delaware, ensuring that its restructuring can go ahead as planned. Vons caps a mind-boggling year for retailers by announcing a complex plan to merge with a Detroit supermarket company and become publicly held.
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