retail news in context, analysis with attitude

The Triangle Business Journal reports that Carol Levenson, director of research at New York-based corporate bond research firm Gimme Credit, is telling clients that she believes that there are strong indications that Kroger management wants to "make a major acquisition."

The story notes that "Kroger's last major acquisition was a year ago, when it bought North Carolina-based Harris Teeter Supermarkets Inc. for $2.5 billion. That added more than 200 stores to Kroger's stable. It also bought online vitamin and supplement retailer for $280 million in August."

While Kroger did not comment on the report, the story notes that Kroger CFO Mike Schlotman has been quoted in the past as saying that the company's balance sheet is strong enough for a major purchase.

The story continues:

"Where might Kroger make an acquisition? It already has 2,600-plus stores around the country, but it still lacks stores in almost all of Florida and in Chicago, the Northeast, upper Midwest and Oklahoma. Those would be likely target areas.

"Schlotman has said that Kroger will enter a new geographic area that it has identified. That sounds like a region it will enter on its own by opening stores, but it could do that and add other markets through an acquisition."
KC's View:
I'm rooting for a northeast US acquisition of some kind ... just because I'd love to see how this market reacts to a first class competitor like Kroger.

But maybe it'll be something else ... something unexpected ... something not even on anybody's radar. Maybe something that makes an e-commerce splash? If I had to put money on something, that's where I'd place it.