Albertsons parent company to buy Safeway - The Packer

Albertsons parent company to buy Safeway

03/06/2014 05:31:00 PM
Andy Nelson

Retail giants Safeway and Albertsons have agreed to merge.

In a conference call March 6, Safeway’s president and chief executive officer, Robert Edwards, announced that AB Acquisitions, the parent company of Boise, Idaho-based Albertson’s LLC, will buy all outstanding shares of Pleasanton, Calif.-based Safeway.

AB Acquisitions is controlled by Cerberus Capital Management LP, a private equity firm. The company is paying Safeway shareholders about $40 a share. At that stock price, the deal is worth about $9 billion, according to a story in the Wall Street Journal.

The deal, whose finalization is pending regulatory approval, ends speculation about who might buy Safeway, which confirmed in February that negotiations for a possible sale were underway. Cincinnati-based retailer Kroger also was rumored to be interested in buying at least a part of Safeway.

In the new, merged company, Edwards will be president and CEO and Bob Miller, Albertsons’ CEO, will be executive chairman, Edwards said.

Combined, Safeway and Albertsons will be able to take their business to the next level, Edwards said.

“This enables our two companies to compete more effectively in an increasingly competitive landscape, providing lower prices, a better assortment of products and a better shopping experience for our consumers,” he said.

The new company will have more than 2,400 stores, 27 distribution facilities and more than 250,000 employees, according to a news release from Safeway and Albertsons. The merger is not expected to result in any store closings, according to the release.

Banners under the new company will include Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, ACME, Jewel-Osco, Lucky, Shaw’s, Star Market, Super Saver, United Supermarkets, Market Street and Amigos.

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Lloyd Bullock    
Alberta  |  March, 07, 2014 at 09:22 AM

WOW!!! How the mighty have fallen. This is a monumental change in the grocery landscape over the last year. Canada Safeway sold to the Sobeys/Empire group and now the US side also gobbled up by a competitor. Looks like Walmart more Safeway. Grocery retail is definitly not boring.

ron bruce    
gerber, ca  |  March, 07, 2014 at 12:50 PM

First off, the Safeway name will not go away, at least for now. Second, I have a hard time wondering what Wal-mart has won. The prices at the super center up here are no better than the prices I pay at a small, brother owned grocery store,up here in n. ca. The real difference is that we all get personal service from the workers there and there is never a time that we do not have a real butcher on staff. For me, this store is only 4.5 miles from my house, and the Wal-mart store is 30 miles away.

spokane  |  March, 11, 2014 at 05:10 PM

They are going to have to lower their prices a lot and get rid of their club cards. I will not shop at a grocery store that requires a card to get a better price. EVERYONE should get the same price.

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