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Ahold started as a small grocery store by Albert Heijn in 1887 until it was listed on the Amsterdam Stock Exchange in 1948 and opened its first self-service supermarket chain in 1955. It operates in two market sectors: food retail and food service in 27 countries throughout Europe, North and South America, and Asia with 9,000 stores, employing 450,000 people, and servicing 40 million customers every week. In 1976, the then CEO initiated an international expansion programme; and in the 1990s, Ahold reinforced its expansion when it decided to do it by means of acquisitions as the engine for growth. The company spent €19 billion in buying 50 companies in four continents when Cees Van der Hoeven, former CFO, became CEO in 1993. Cees Van der Hoeven promised 15% annual earnings per share growth, and had ambitions to make Ahold one of the largest food providers in the world. In 2000, Ahold diversified into the wholesale food service by acquiring US Foodservice. This initiated Ahold’s problems and their fraudulent bookkeeping. US Foodservice executives manipulated vendor payments known as promotional allowances as a way to increase revenues by providing Deloitte, Ahold’s independent auditors, with false information. Ahold also fully consolidated several joint ventures despite not having management control; which caused its revenues to be overstated.
In 2002, the company had suffered its first quarterly loss in over 25 years of operations. In February 2003, it announced ‘significant accounting irregularities’ in its 2000 and 2001 financial statements. Ahold had to face multiple lawsuits and its shares lost 60% of their value.
Ahold started as a small grocery store by Albert Heijn in 1887 until it was listed on the Amsterdam Stock Exchange in 1948 and opened its first self-service supermarket chain in 1955. It operates in two market sectors: food retail and food service in 27 countries throughout Europe, North and South America, and Asia with 9,000 stores,