Smart & Final wants to buy 3 Haggen stores in SLO County

The Haggen grocery store in Atascadero.
The Haggen grocery store in Atascadero.

Three of the Haggen grocery stores that are being closed in San Luis Obispo County may become Smart & Final stores.

Smart & Final LLC has signed an agreement with the struggling grocery chain to purchase 28 stores in California and Nevada, including the locations in Atascadero, Paso Robles and San Luis Obispo at Johnson Avenue, as part of Haggen’s ongoing bankruptcy. The purchase price of all 28 stores is $56 million, according to a Smart & Final news release.

The purchased stores will be converted into Smart & Final Extras, which feature more bulk organic options and household items, according to the news release. The stores are also larger than traditional Smart & Final warehouse stores.

Smart & Final already operates three locations in the county — in Arroyo Grande, Paso Robles and San Luis Obispo — and about 270 stores throughout California, Oregon, Washington, Arizona, Nevada, Idaho and Northern Mexico.

Media representatives for the company did not respond to request for comment Monday on whether the existing Smart & Final stores in Paso Robles and San Luis Obispo would close to make way for the newer locations.

The agreement is still dependent on approval from the U.S. bankruptcy court. The timing of the conversion process would vary on a store-by-store basis, but if approved, is expected to start during the company's fiscal fourth quarter of 2015 and to be completed during the company's second quarter of 2016.

The fate of three other San Luis Obispo County Haggen locations is still up in the air. The Los Osos store is slated to close this month, with the San Luis Obispo at Foothill Boulevard and Arroyo Grande locations expected to follow sometime in late November or early December, unless another buyer for the locations comes forward.

According to the news release, Haggen has filed motions with and is seeking the approval of the bankruptcy court to establish procedures to sell its stores, as well as set up a closing timetable for its other locations.

In December 2014, Haggen bought 146 Albertsons, Vons, Pavilions and Safeway stores, including 83 in California, after the Federal Trade Commission ordered Albertsons and Safeway to sell the stores in light of their merger. The purchase included the six locations in San Luis Obispo County.

Since the switch, Haggen has had an embattled tenure in Southern California, where competition was tight and the chain was hammered with complaints of higher prices and layoffs.

The company announced a round of closures in August and followed up with plans to close all of its Pacific Southwest stores in September. Haggen sought Chapter 11 bankruptcy protection on Sept. 8, which allows it to fend off creditors while working out a plan to repay debts.

Map of Haggen stores to be purchased by Smart & Final