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Safeway sold for $9.4 billion, merges with Albertsons

dmcowen674

No Lifer
Oct 13, 1999
54,908
44
91
www.alienbabeltech.com
3-7-2014

http://www.mercurynews.com/business/ci_25289725/safeway-sold-9-billion-merges-albertsons-cerberus

Safeway sold for $9.4 billion, merges with Albertsons



PLEASANTON -- Safeway announced on Thursday it had been bought by private equity firm Cerberus Capital Management in a $9.4 billion deal that will merge the Bay Area's dominant grocery chain with Albertsons, creating a massive chain that promises to further transform how Americans shop for groceries.


For Safeway employees -- who will be negotiating a new contract with the company later this year -- jobs could be on the line, as antitrust regulations and duplication between the companies may lead to individual store sales and closures.


Supermarket analyst David Livingston says shoppers shouldn't get their hopes up for lower prices.

"You aren't going to see them come up with any brand new ideas about how to sell groceries but you are going to see them come up with brand new ideas about how to save on expenses, and increase profits," he said.

"Obviously you're going to have some closures, because there are stores across the street from each other," Livingston said.

Albertson's also operates Jewel-Osco, Shaw's, Star Market and other grocery chains around the country.

The companies expect the merger to be completed in the fourth quarter, although Cerberus will need much of the year to work out antitrust issues with the Federal Trade Commission. Until then, other companies also have the opportunity to bid for Safeway, as the Cerberus deal includes a so-called go-shop provision to allow Safeway to seek other offers.

Safeway shareholders got a healthy payday out of the deal. The company will pay investors $40 per share, which marks a 72 percent increase over Safeway's stock price a year ago.
 

dmcowen674

No Lifer
Oct 13, 1999
54,908
44
91
www.alienbabeltech.com
Two big red flags:

First there is less and less places to get Groceries in the U.S. which leads to higher prices.

Second, how much of the U.S. does this private equity firm Cerberus Capital Management now own?

They have been on a tear for quite a few years now buying up every Industry.
 
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Matt1970

Lifer
Mar 19, 2007
12,321
2
0
Two big red flags:

First there is less and less places to get Groceries in the U.S. which leads to higher prices.

Second, how much of the U.S. does this private equity firm Cerberus Capital Management now own?

They have been on a tear for quite a few years now buying up every Industry.
I don't think I have met anyone further detached from reality than you.
 

Matt1970

Lifer
Mar 19, 2007
12,321
2
0
You really aren't good at any of this are you? From your horrifically embarrassing gas and milk price predictions to your call to arms against the rich you never cease to amaze.
 

hal2kilo

Lifer
Feb 24, 2009
15,227
3,470
136
Will their captured brand be "Select Western Family" or "Western Family Select"?
 

blackangst1

Lifer
Feb 23, 2005
20,148
617
126
As am employee of Safeway I can say "merge" isnt really a correct statement. Albertson's and Safeway are two very different business models with different clientele. Based on what Ive heard...from various sources...say Ceberus will keep the two businesses separate. Most of the changes will be in executive management at both firms.

That said, Ceberus also owns Remington and Bushmaster. Will we get discounts on guns now? :awe:
 

Londo_Jowo

Lifer
Jan 31, 2010
17,304
158
106
londojowo.hypermart.net
As am employee of Safeway I can say "merge" isnt really a correct statement. Albertson's and Safeway are two very different business models with different clientele. Based on what Ive heard...from various sources...say Ceberus will keep the two businesses separate. Most of the changes will be in executive management at both firms.

That said, Ceberus also owns Remington and Bushmaster. Will we get discounts on guns now? :awe:
In before McOwned can say:

Here we have a food industry thug that supports giving people less choices while driving milk prices to over $10 a gallon
 

IGBT

Lifer
Jul 16, 2001
17,699
47
91
expect store closings and reductions in labor force with possible mid manager reductions.
 

JManInPhoenix

Golden Member
Sep 25, 2013
1,508
1
81
No real effect for me. We have a Safeway & Frys (Kroger owned) around the corner. Within 5 miles there is another Safeway, Albertsons, super Target, super Walmart, Whole Foods, Sprouts, AJs, etc, etc...
 

feralkid

Lifer
Jan 28, 2002
14,961
2,257
126
expect store closings and reductions in labor force with possible mid manager reductions.
Plus America going down the shitter.
How did that Mom-Jean wearing Tyrant allow this to happen.
 

ElFenix

Elite Member
Super Moderator
Mar 20, 2000
101,018
4,763
126
albertsons died in the houston market about 15 years ago, safeway got run out of town about 25 years ago and then re-entered by buying up the local store, which they promptly ran into the ground and i don't know how they stay open.
 

zinfamous

No Lifer
Jul 12, 2006
103,500
18,063
136
Good.

95% of our agriculture is controlled by a single entity, might as well work towards achieving the same patriotic goal with our distributors.
 

feralkid

Lifer
Jan 28, 2002
14,961
2,257
126
albertsons died in the houston market about 15 years ago, safeway got run out of town about 25 years ago and then re-entered by buying up the local store, which they promptly ran into the ground and i don't know how they stay open.

You see all those Randall's stores around Houston?


That's Safeway.

Same with Tom Thumb in the DFW area.
 

Wreckem

Diamond Member
Sep 23, 2006
9,058
435
126
You see all those Randall's stores around Houston?


That's Safeway.

Same with Tom Thumb in the DFW area.
That is what he was referring to when he said they bought up the local chain. Randalls bought Tom Thumb in 1992. Safeway bought Randalls(and Tom Thumb) in 1999.

Albertsons pretty much died a few years back. The investment firm that now owns them is buying up grocery chains to maximize efficiency of their distribution network. The he supply chain and distribution network are the keys to a profitable grocery enterprise. For non Walmart stores to compete with Walmart they need to consolidate their enterprises to have more leverage over the supply chain(like walmart has) and have a larger more efficient distribution network. It also allows them to close poorly performing stores.
 
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Strk

Lifer
Nov 23, 2003
10,199
4
76
You should care less about the amount of stores and more that most are supplied by the same few companies.
 

Agent11

Diamond Member
Jan 22, 2006
3,535
1
0
It would be interesting if laws required branding and signage to show the ownership of the various franchises.
 

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