Safeway, Albertsons Announce Merger

The merger will likely be completed by the end of 2014.

By Bay City News—

Safeway Inc. and Albertsons today announced a merger agreement for the two grocery chains under which the owner of Albertsons will buy all outstanding Safeway stock in a $9 billion deal. 
The combination of Pleasanton-based Safeway's 1,335 stores in 20 states with the 1,075 outlets of Boise, Idaho-based Albertsons will create a nationwide network of more than 2,400 grocery stores, the two companies said in a statement released today. 
The companies said they expect administrative cost savings, but don't expect to close any stores. The Safeway shares will be bought by AB Acquisition, which owns the Albertsons chain and is controlled by Cerberus Capital Management LP. 
The merger is expected to be completed by the end of 2014. The agreement also provides for a three-week so-called "go-shop" period in which Safeway can receive and consider alternate proposals, the companies said. 
Safeway President and Chief Executive Officer Robert Edwards said, "This merger is one of several actions we have taken in recent months as a result of our strategic business review. 
"Safeway has been focused on better meeting shoppers' diverse needs through local, relevant assortment, an improved price/value proposition and a great shopping experience that has driven improved sales trends. We are excited about continuing this momentum as a combined organization," Edwards said in the press release. 
If the merger proceeds as planned, Edwards will become president and CEO of the combined company, while Bob Miller, the current CEO of Albertsons, will become executive chairman.

Bhatman March 08, 2014 at 02:36 PM
This "mergers stifle competition" talk is a myth, because people can't seem to see beyond the initial market dynamics. Take the airline business for example. All the large legacy airlines have merged, but did that create big bloated airlines that dictate prices? No, niche players were able to exploit the markets that the behemoths couldn't or wouldn't fill - and thus we have far, far lower airfares because of the SWA and Jet Blues of the world. The same thing has happened in telecommunications and even the ultimate example of market domination -the Microsoft/Intel duopoly, how's the price on PCs or notebooks looking?
Oedi March 08, 2014 at 02:46 PM
Corporate mergers are an example of capitalism at work, yet some people think they're a harbinger of socialism and a third-world America. Oy.
Concerned Md Citizen March 08, 2014 at 06:43 PM
the good news is that a reputable company bought Safeway; the bad news is they may keep the same awful management personnel therefore stifling its rebuilding.
Steve Pogue March 08, 2014 at 09:08 PM
Interesting that the price paid for long-established Safeway with 1,305 stores in 20 states is less than half of what Facebook paid for Whats App. Seems a little out of balance, no?
Gladwyn d'Souza March 10, 2014 at 11:47 AM
Only if there is an earthquake or other natural disaster and folks are dependent on the three day supply at Safeway. Hopefully Albertson closes all these dumps. Remember Safeway's response to selling pink slime- all our products are approved by the USDA.


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