Kroger may make bid for Safeway - The Packer

Kroger may make bid for Safeway

03/06/2014 11:55:00 AM
Andy Nelson

See related content: Albertsons parent company to buy Safeway.

Retail giant The Kroger Co. may be interested in buying part of fellow grocer Safeway Inc.

Cincinnati-based Kroger recently approached Safeway about buying part of the Pleasanton, Calif.-based chain’s operations, according to a March 3 story in Bloomberg News.

Kroger also has contacted Cerberus Capital Management LP, a private-equity firm that is reportedly bidding for Safeway, about buying some Safeway stores Cerberus may not want, according to the story.

According to a March 5 story in the Wall Street Journal, Cerberus is offering about $40 a share for Safeway, valuing the company at about $9 billion.

Safeway and Cerberus officials did not return requests for comment. Kristal Howard, Kroger’s public relations manager, said the company doesn’t “comment on rumor or speculation.”

In February, Safeway confirmed reports that negotiations for a possible sale were underway. The company did not name a potential buyer.

Also in February, Safeway reported net fourth quarterly earnings of $100 million, down from $171 million in the fourth quarter of 2012.

In October, Safeway announced plans to leave the Chicago market, where it operated 72 Dominick’s stores. In November, the company sold Canada Safeway to Sobey’s Inc. for $5.8 billion.

The sale of Safeway to Kroger or Cerberus, which owns the Albertsons grocery chain, could raise antitrust concerns, according to the Bloomberg News story.



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