Closure of 125 Albertsons Stores Presents Opportunities for Competing Chains; Publix, Wal-Mart expected to see biggest gains.

WILTON, Conn. -- The closure of 125 stores owned by Albertsons LLC in August will allow competitors in 26 different markets to increase their grocery market share, says a study issued by Trade Dimensions International, Inc. today.

In June, Cerberus Capital Management LP, new owners of 645 Albertsons, Grocery Warehouse and Super Saver stores under the Albertsons LLC umbrella revealed plans to close 125 supermarkets, affecting 26 CBSAs across the country. Three Grocery Warehouse locations, 26 Super Saver stores, and 96 Albertsons-bannered stores in seven states will close. By division, the closings have the greatest impact on the Northern California, Dallas and Extreme divisions, which will see 36, 30 and 25 closings respectively. Other affected divisions include the Rocky Mountain (16 stores), Southwest (9), Florida (8) and Southern California (1) divisions.

Many of the country's largest markets, including top 25 markets Dallas-Fort Worth-Arlington, TX; Denver-Aurora, CO; Miami-Fort Lauderdale-Miami Beach, FL; Phoenix-Mesa-Scottsdale, AZ; San Diego-Carlsbad-San Marcos, CA; San Francisco-Oakland-Fremont, CA; and Tampa-St. Petersburg-Clearwater, FL will see market share shifts. Using Trade Dimensions market share information, along with a Spectra Dollar Flow report, we are able to make predictions as to where the former Albertsons customers will spend their money once the Albertsons locations have closed. Some details:

Orlando-Kissimmee, FL

Less than one tenth of one percent separates the number one grocery retailer in the Orlando CBSA (Publix, 33.14%) from the number two (Wal-Mart, 33.07%). With four Super Saver stores, comprising just under 0.90% of the total grocery market share, slated for closure, the number one position is truly up for grabs. A Spectra Dollar Flow report shows that the 41 Publix stores and the 20 Wal-Mart stores (including five Neighborhood Markets) in the market will likely experience similar gains after the Super Saver stores close, making for a continued tight race.

Publix may continue - at least temporarily - to have a slight edge here, as perhaps customers that have not warmed to shopping in one of Wal-Mart's massive stores will prefer the more traditional Publix stores, but it is hard to tell. Retailers from other channels should also see a slight bump, including CVS and Walgreens, each of which operate approximately 40 stores in the market; and Target, which has 12. Over 40 independent grocers within a 6-mile radius of any of the closing Albertsons stores in the market also stand to see small gains.

Phoenix-Mesa-Scottsdale, AZ

With just under 400 supermarkets in its boundaries, the Phoenix CBSA is a large, highly competitive one. Wal-Mart leads the pack with 25.92% of the grocery market, followed closely by Kroger (Fry's, 22.29%), Bashas (18.40%) and Safeway (14.44%). The eight Albertsons stores that are closing comprise 1.25% grocery market share. Capturing that share would close the gap for any of the four leaders above, but it appears that Kroger's Fry's stores and Wal-Mart will actually see fairly similar sales increases. Fry's may have the advantage here though, as its 67 stores in the market are an average of 3.4 miles away from the closest Albertsons store. In addition, the characteristics of a typical Fry's location (size, format, merchandise lines, ACV) tend to be close to those of a typical Phoenix-area Albertsons store. Wal-Mart's 41 stores in the market are, on average, 4.1 miles away.

Bashas' 50 Phoenix area stores will likely only see just half the sales increase as the two grocery leaders. Here too, as in Orlando, non-grocery retailers like Circle K, Target and Walgreens should expect to see fairly sizeable gains too.

While the closings and subsequent shifts in grocery share in Orlando and Phoenix will likely receive more attention because of the number of closing stores and the already tight races, interesting situations are expected to play out across the country in many smaller markets as well.

Deltona-Daytona Beach-Ormond Beach, FL

What is already a relatively tight race for first place in terms of grocery market share is expected to get even more competitive. As of June 2006, Wal-Mart's five supercenters in the market comprise 33.78% of the total grocery market share, landing it in first place. Publix's 19 supermarkets, however, are not far behind, with 33.64% share. Less than two-tenths of one percent separates the two chains. Subtract the share garnered by the two Super Saver locations closing in the market (2.26%) and the race becomes even closer.

As in Orlando, the race for share here comes down to Publix and Wal-Mart, with Publix having a slight edge, if only because of proximity. Publix locations are closer on average to either of the closing Super Saver stores, at just 3.5 miles, while Wal-Mart stores are an average of 6.8 miles away from either Super Saver.

Vallejo-Fairfield, CA

Led by Safeway (27.51% of the grocery market) and Raley's (19.13%), Vallejo is only losing one Albertsons store; three other locations in the market will remain open. But because the market is a small one - only 36 supermarkets as of June 2006 - any store opening or closing tends to have a dramatic effect. Albertsons current share is 6.88%; the one store closing leaves the door open for Safeway, Raley's, or Save Mart.

Spectra's Dollar Flow report indicates that because of its proximity to the closing Albertsons store - it is less than one-tenth of a mile away - one particular Raley's location could benefit more than any other store in the market. The four Raley's stores in total should see a combined increase equal to 3.5 times the increase that the three Safeway stores will see. The grocery market share race in Vallejo will get even tighter as Save Mart's two Food Maxx locations will see a total increase that is less than Raley's, but greater than Safeway.

Please note: The information contained in this release provides an estimate of market conditions at a given moment in time. It is compiled or derived from publicly available reports and private sources. Information may vary from prior Trade Dimensions publications or from actual market figures due to changes in markets or retailer organizations or from differences in methodologies used to derive estimated values.

About ACNielsen Trade Dimensions

Trade Dimensions International, Inc. is owned by ACNielsen Homescan & Spectra and is a VNU business. VNU is the world's leading marketing information provider. Trade Dimensions has over 35 years of experience and innovation in developing some of the most sophisticated, reliable and widely-used retailer information products available. To learn more, visit www.tradedimensions.com.

About ACNielsen Homescan & Spectra

ACNielsen Homescan & Spectra, a global business unit of ACNielsen, is the leader in delivering consumer and shopper insights, and creating marketing efficiency for FMCG companies through world-class segmentation and targeting services. Homescan solutions are the leading and premier provider of longitudinal consumer purchase behavior, demographic profiles, integrated attitudes & usage information, and evaluating the impact of media on actual behavior. Spectra solutions provide clients with world-class segmentation and targeting services that help them identify high-value consumers, uncover new opportunities to be able to communicate to these consumer segments, and execute marketing and sales efforts at the store level.