The Bellingham-based grocery chain says lenders have committed up to $215 million to keep the company running while it sells stores. It also says that Bill Shaner, the executive in charge of its big Southwest expansion, has left the company.
The move is the latest in a saga that began earlier this year when Haggen took over 146 stores shed by Albertsons and Safeway after their merger, mostly in California, Nevada and Arizona — markets where the 18-store Pacific Northwest grocer was unknown.
Haggen, backed by Comvest, a private equity firm based in Florida, paid more than $300 million for the stores, according to court documents. It prepared for a big ramp-up as regulators approved the sale in late January. But its ambitions ultimately backfired.
Haggen’s higher prices turned many customers off, and in June the company began reducing employee hours and laying off hundreds. The layoffs triggered a firestorm of negative press across Haggen’s vastly expanded territory, and plenty of litigation, including from a developmentally disabled former employee who was laid off. Unions also cried foul.
Haggen’s unlikely empire was born out of Albertsons and Safeway’s need to ditch a big number of stores so the Federal Trade Commission would approve their $9.4 billion merger.