Jim Donald takes the helm at Albertsons
Albertsons has promoted Jim Donald (right) to president and CEO, succeeding Bob Miller (left) in the CEO role, a move that came as “no great surprise” to Neil Saunders at GlobalData Retail: “There have been rumors for some time that Miller wished to hand over the day-to-day running of the operation.
“Although there is no doubting Miller's expertise and his contribution to the retail industry, his tenure at Albertsons since its takeover of Safeway and sale to Cerberus Capital Management has been mixed,” added Saunders.
“While progress has been made on integrating Safeway and on some digital initiatives, the company is hindered by a very heavy debt burden. This has weakened profits and stymied investment. As a consequence, Albertsons is now a laggard in the grocery industry in terms of its proposition. Stores are suffering from underinvestment, prices are way too high, and the offer looks tired. In our view, this is a dangerous position to be in at a time when grocery competition is increasing.
“Remedying this will now fall to Jim Donald. His depth of experience at Walmart, Starbucks, Publix, and many other retailers will serve him well. However, given the state of Albertsons' balance sheet and Cerberus' probable desire for a sale, his room for maneuver is limited and he will be under intense pressure to come up with quick-fixes.
“Overall, as much as we welcome this move, we remain deeply unimpressed by Albertsons. This is not so much because of Mr. Miller or Mr. Donald. It is largely because past bad decisions, including the acquisition of Safeway, and Cerberus’ short-termism, have put the company in a very challenging position.”