Haggen files for Chapter 11 bankruptcy

A Washington-based grocery chain that moved only recently into the Las Vegas market said Tuesday that it has filed for bankruptcy.

Haggen, which locally operates seven former Albertsons and Vons stores, filed a Chapter 11 bankruptcy petition with a U.S. court in Delaware.

In its filing, the company said creditors have committed up to $215 million to keep the company running while it sells stores.

A company spokeswoman told the Review-Journal on Wednesday that Haggen plans to "reorganize around a reduced portfolio of locations," but she could not comment on store closings just yet.

It's not the first trouble for Haggen, which struggled in the recession and filed a $1 billion lawsuit last week alleging that Albertsons was trying to put its new stores out of business.

Until the recession, the 72-year-old Haggen was a family-owned grocer. But the economic downturn took a major toll on the company, and it looked in 2011 to Florida-based investment firm Comvest Group to buy a majority share and develop a strategy to strengthen it.

Comvest was also an early investor in Summerlin-based Allegiant Air, helping it raise more than $90 million in stock before selling its share in the company after 2007.

Comvest pared Haggen's stores from 30 to 18 locations, where it stayed until 2015.

In March, the Federal Trade Commission forced divestment of stores in a merger of Safeway and Albertsons.

A December report in the Seattle Times said Haggen CEO John Clougher felt the company was "ready to grow again.

Haggen spent $300 million on the Safeway-Albertsons acquisitions. The deal expanded Haggen's store count by more than 800 percent in 2015, from 18 locations in Oregon and Washington to 164 stores in those states and Nevada, California and Arizona. When it moved into its new markets, Haggen emphasized its commitment to locally sourced products, organic produce, salads made in-house and preservative-free meats.

But Haggen's lawsuit last week accused Albertsons of conduct that hurt quality and increased prices for thousands of customers. The lawsuit also alleged that Albertsons caused "needless loss of jobs" and inflicted severe financial harm on Haggen. Haggen executives said damages in the breach of contract and fraud claim could exceed $1 billion.

Albertsons said it will defend the case "vigorously."

Area Haggen stores are at 1031 Nevada Highway in Boulder City; 2910 Bicentennial Parkway; 190 N. Boulder Highway; 575 College Drive; 7530 W. Lake Mead Blvd.; 820 S. Rampart Blvd.; and 1940 Village Center Circle.

Haggen announced 27 store closings in August, but no local stores were on the list of closing locations.