Albertsons, an affiliate of Cerberus Capital Management L.P., has entered into an agreement to acquire retailer Safeway, Inc., Pleasanton, CA, for an estimated total purchase price of $9 billion. Under the merger agreement, Safeway shareholders will receive $32.50 per share in cash. Additionally, shareholders will have the right to receive pro-rata distributions of net proceeds from primarily non-core assets with an estimated value of $3.65 per share. The deal is estimated to be completed by the fourth quarter of 2014.
“This transaction offers us the opportunity to better serve customers by adapting more quickly to evolving shopping preferences in diverse regions across the country,” says Bob Miller, chief executive officer of Albertsons.
The merger will create a network that includes more than 2,400 stores, 27 distribution facilities and 20 manufacturing plants with 250,000 employees. Retail banners included in the network will be Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, ACME, Jewel-Osco, Lucky, Shaw’s, Star Market, Super Saver, United Supermarkets, Market Street and Amigos. Albertsons said no store closings are anticipated.
Miller, will become executive chairman of the new organization, and Robert Edwards, Safeway’s current president and chief executive officer, will become president and chief executive officer of the combined company.