A top City analyst has slammed Ahold's growth strategy as being "overly dependent" on acquisitions. West LB Panmure's Philip Dorgan has rated the Ahold stock a "sell" a week after Ahold announced record results and two major acquisitions in the US (The Grocer, September 8, p18). Dorgan said Ahold's failure to break down the costs of integrating purchases in its accounts made it difficult to properly assess performance. His comments followed reports that Grand Union stores, acquired by Ahold last year and rebadged as Stop & Shop and Tops, have failed to meet sales expectations. Dorgan said: "I'm not saying Ahold is a lousy company, but you have got to separate moves that offer a strategic advantage and those that make sense for shareholders. "Strategically, buying Alliant [the third largest foodservice firm in the US] makes sense, but did they get a good price?" In a survey earlier this year of 50 analysts who cover Ahold, Dorgan said "about 47 had a buy recommendation, two had a hold' and I had a sell'. My position hasn't changed." Dorgan's City counterparts have defended Ahold's strong like-for-like performance in the US and pointed to its successful track record in acquisitions. "This is such a stale criticism," said one analyst, who preferred not to be named. "Of course Ahold is an acquisitive company. But you have to take a step back and look where the Alliant deal puts it strategically. "This is a bloody good deal. It puts Ahold up alongside Sysco in foodservice." Other analysts praised Ahold for building on the strengths of its purchases and sharing good practice rather than imposing new management and systems on the companies. "Compare Wal-Mart's experience in Germany with Ahold's in Scandinavia or the US," said another London analyst. "They haven't put a foot wrong." {{NEWS }}

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