Thrifty Corp., a longtime partner of Dart Group Corp. in Crown Books Corp. and Trak Auto West, pulled out of both ventures yesterday.
Thrifty, a West Coast drugstore chain, was acquired on May 28 by Pacific Lighting Corp., a utility, for $875 million. Thrifty said it sold its 34 percent stake in Crown back to the company for $37 million, or $13.45 a share. That was $1.80 a share less than the stock was trading for yesterday, and $11.55 a share less than the $25 price tag placed on the stock when it first was sold to the public in August 1983.
Thrifty also relinquished its 50 percent stake in the troubled Trak Auto West, which has posted losses for the past three years. Thrifty gave up its shares to Trak Auto Corp., which owned the other 50 percent of Trak Auto West, after it agreed to contribute $11.7 million to Trak West's capital.
Trak Auto Corp. also agreed to contribute the same amount to the subsidiary's capital and make it wholly owned by Trak Auto Corp., a company in which Dart Group Corp. holds a 66 percent stake.
Neither Dart nor Thrifty officials were available for comment. However, Robert B. Hirsch, attorney for Dart, its chairman, Herbert H. Haft, and president, Robert M. Haft, said the transactions "represented a good opportunity for Trak Auto and a similarly good opportunity for Crown."
Officials at Pacific Lighting said discussions concerning the sale of Thrifty's interests in the Crown and Trak Auto operations did not begin until after the announcement of the merger of Pacific Lighting and Thrifty.
However, for the past few months, Wall Street analysts and drugstore industry executives have said that Thrifty was trying to sell its stake in Trak Auto West, which has been beset by low sales and high expenses. In fiscal 1984, the company lost $5.8 million; in 1985, the loss climbed to $8.5 million. For the fiscal year that ended Jan. 31, the losses totaled $6.8 million.
Industry executives say it was more than just the financial losses that were troubling Thrifty.
"The Thrifty people want to disassociate themselves from the Hafts," noted David Pinto, editor of Chain Drug Review. "Herbert Haft's reputation in the chain-drug industry is not the best -- and probably worse now than it's been thanks to his unfriendly takeover bids for Jack Eckerd Corp., the nation's second-largest drugstore chain, and Revco Corp., the nation's third-largest chain," Pinto said.
The buyback of Crown's stock means that fewer shares will be outstanding and that Dart automatically increases its stake in the discount bookstore chain from 34 percent to 52.4 percent.
Until now, Thrifty was allowed to name two of the five directors on Crown's board. With the sale of its stake, both directors have resigned, including Thrifty's chairman, Leonard H. Straus, who had served as cochairman with Herbert Haft. Haft's son Robert is president and runs the company.
Haft's attorney said that Herbert Haft's wife Gloria has taken one of the two vacant seats on the board. The remaining vacancy will be filled at an upcoming corporate meeting.
Hirsch also said that Trak Auto West probably will remain a separate subsidiary within Trak Auto Corp. and not be incorporated with the rest of the company. He added that there are no further plans to sell the troubled subsidiary.
Financial figures for Trak Auto released yesterday show that Trak Auto West has reduced its losses for the most recent quarter that ended April 30 to $1.2 million, down from $1.8 million for the same period a year ago. Low sales and high expenses in the Los Angeles market continue to be major factors behind the loss.
Profits for the entire Trak Auto Corp. were down 22 percent for the quarter, to $1 million (17 cents a share) from $1.3 million (22 cents) for the same period last year. Sales for the Trak Auto East were up 22 percent to $25.8 million from last year's total of $21.1 million. Crown Books' profits increased marginally for the quarter, to $1.35 million (17 cents) from $1.3 million (17 cents) for the same period a year ago. Sales for the three months increased 20 percent to $31.2 million from $25.9 million.