‘Round The Trade
Amazon finally made it official – it will be opening two additional HQ locations: Crystal City, VA and Long Island City, NY which will add a combined 50,000 new jobs. Obviously, this is great economic news for those municipalities, but just imagining the increased traffic issues already associated with two of the busiest areas of the East Coast could make a person throw up in their mouth…it looks like investor Dan Loeb and his Third Point LLC hedge fund’s attempt to overhaul Campbell Soup’s board and potentially sell the company may come up short. Loeb is now saying that the Camden, NJ packer should consider splitting the company into two units – snacks and meals/beverages – instead of a sale. He also suggested that former Campbell’s exec and recently retired Hostess chief executive Bill Toler be named CEO. Campbell’s has rejected Loeb’s efforts from the outset and said in a statement that “Third Point’s campaign to seize control of the board can be summed up as follows, ‘vote for us and we’ll think of something.’” November 29 is showdown day – that’s when Campbell’s will hold its annual shareholder’s meeting. Loeb’s animated efforts to change the direction of a company that has significantly underperformed for a decade are not off base, but as is the case with many hedge fund takeover plays, it’s hard to believe that Loeb’s first priority isn’t a quick money grab. And sometimes that strategy works, as it did for Blackwells Capital which reaped a gain of $75 million when Supervalu ultimately sold to UNFI. And speaking of those latter two distributors, I’m still not hearing good things about the company’s recently opened distribution center in Harrisburg, PA where several customers said that service levels remain in the 80-85 percent range. Just a thought: I wonder how many Supervalu/UNFI retailers have “change of control” opt out clauses in their contracts?…National Grocer’s Association CEO Peter Larkin will be retiring from that post at the end of next year. Since he took the helm at the nation’s largest independent retailer trade association more than eight years ago, NGA’s retail and wholesale membership has doubled. The group will be holding its annual convention in a new location, San Diego, from February 24-27… in the wake of Sears’ Chapter 11 filing last month, the company’s board has hired investment bank Evercore to examine business and real estate deals made by former CEO Eddie Lampert. Lampert will also face scrutiny from Sears’ unsecured creditors’ committee, which includes vendors, landlords and a watchful eye from the Feds who will be looking after the interest of Sears’ remaining pensioners. Have fun, Eddie…Wegmans will be adding a fifth store to its expansion plans for the Raleigh-Durham-Chapel Hill area of the Tar Heel state. The Rochester, NY-based merchant will build a 100,000 square foot unit in Wake Forest, NC, adding to previously announced new stores in Raleigh (which debuts next year), Chapel Hill and two in Cary. In 2019, the family-owned regional chain will also cut the ribbon on new stores in Virginia Beach and in Brooklyn, NY…Publix, which will be duking it out with Wegmans in the Research Triangle and is already going toe-to-toe with the uber-retailer in Richmond, will be further expanding its store count in the capital of the Old Dominion. The Lakeland, FL supermarket firm, which opened its 10th Richmond-area store on November 14 at Otterdale and Hull Street roads in Chesterfield County, has signed a lease to open the former Martin’s store on Midlothian Turnpike and Charter Colony Parkway. That 74,000 square foot store was Martin’s largest and only new “from the ground up” unit that Martin’s built in Richmond after acquiring the Ukrop’s operation in 2010. I always found it curious that Publix didn’t opt for that site when it acquired 10 other Martin’s in 2016. Also on the slate for this year is a new Publix store that will open on Mechanicsville Turnpike in Hanover County. The highly-profitable chain has four other Richmond-area stores targeted for development: Huguenot Shopping Center; Carytown; Three Chopt Road and West Broad Street (Westpark)…Instacart, one of today’s hottest grocery-related companies, said it has raised an additional $600 million in new financing and claims its market value to be $7.6 billion…and the big K has also released its food trend predictions for 2019. Hot trends include increased consumption of regional flavors and plant-based food; healthier and more convenient lifestyle foods (including vegetarian, keto and paleo); the offering of more “gut healthy” foods including products that are rich in probiotics; and the promotion of low-sugar and naturally sweetened products (including honey and agave). I reviewed the list closely, and sadly, did not see the word cheeseburger mentioned once.