The Charlotte Observer today reports that Harris Teeter is for sale. That has people in Asheville wondering what’s going to happen to the Harris Teeter grocery store under construction right now on Merrimon Avenue.
Anyone have any thoughts on that?
Here’s what two analysts told the Charlotte Observer:
Jeremy Diamond, a retail analyst based in Baltimore, said in the trade publication Progressive Grocer that he expects a competitor to buy Harris Teeter.
“The company has a solid store base, caters to a higher household income bracket in most of the neighborhoods where it operates, and would have multiple competitors interested in buying the company,” Diamond said. He said upscale grocers, including Whole Foods, Wegmans, and Ahold, which operates Giant and Stop & Shop, could buy all or part of Harris Teeter.
Wisconsin-based supermarket analyst David Livingston said he thinks it’s more likely a private equity firm might acquire Harris Teeter and sell it piecemeal. “I would expect one of the private equity retail morticians to put the company on life support and sell off all its organs,” Livingston said in an email.
Click over to read the full story.
Regarding Orulz comment about the size of Wegmans vs the size of HT, store count alone is the best way to measure the realtive size of each company. HT has 211 stores which generated $4.3 Billion in sales in FY 2011. Wegamns operates 81 stores which generated a reported $6.1 Billion in sales in 2011. So the Wegmans business model produced @50% more in total sales while having 130 fewer stores. The larger hurdle for a Wegmans purchase of HT, in my opinion, is that the typical Wegmans store is more than twice the square footage of an average HT. Wegmans would need to make some pretty large changes to their perfered store layout and inventories if they were to move in HT locations. Those changes and the retrofit costs may not be worth the financial effort for Wegmans but on the other hand, there is a compelling agrument that pbuying HT would give Wegmans an instant top market presence and southern distribution network. It will be interesting to see how this all plays out over the next few months.
Wegmans is building farther South than VA.
I drive for Wegmans and work out of the Rochester, NY distribution center. Wegmans is working on a store in North Carolina. Wegmans has a distribution center in Potsville,PA and that location is going to supply North Carolina. I hope Wegmans is involved with the purchase of Harris Teeter. It will make the company financially stronger and offer me more job security.
Wegmans seems too small to acquire a chain like Harris Teeter. Wegmans = 81 stores. Harris Teeter = 211 stores. How would Wegmans raise that much capital?
It would seem pointless for Kroger to have been in the NC market, only to downsize dramatically, and then upsize again.
I would hazard that Safeway would be the most likely candidate, because of size and geographic distribution. This would give the nation’s largest grocer a very solid hold in the southeast plus a bit of an upscale reputation. Harris Teeter has a good reputation so whoever acquires it could conceivably even keep the Teeter brand.
Publix is possible, but it seems they already have a plan in motion to move in themselves.
Intuitively, Publix would be the most obvious choice. They have said they want to be in North Carolina, and this would give them an instant presence with store locations that are aligned with their typical stores.
If it was any of the above, it would be Publix. They’re getting ready for their first NC store in Charlotte anyhow next year. Wegmans has absolutely no plans to build any farther South than VA.
It’s going to be great having all of these new grocers to chose from. Publix would be great, wholefoods great, Kroger not so…
Either way traffic on merrimon going to be a problem. Would like to have more local markets like dough and liveys to shop at. Such a small city for all of the chains.
Please let it be Publix! Please let it be Publix!
My money’s with Wegman’s. Great company to work for.
Hope Whole Foods dont buy it. If they do, construction will stop on the new harris teeter and if it remains dormant for a period of time, it will quickly become an eyesore. Whats the point of having 3 Whole foods in about a 5 mile radius in ASHEVILLE?!?!?! Hopefully Wegmans, Publix, or Albertsons buys Harris Teeter. Give Asheville REAL Grocery Competition.
Isn’t “Private Equity Retail Mortician” a Butthole Surfers album?