dmcowen674
No Lifer
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.
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.
