LAS VEGAS (KSNV & MyNews3) -- Two grocery giants -- Safeway and Albertsons – are merging.
The two companies announced a definitive agreement today. The merger was unanimously approved by Safeway’s board of directors.
As a result of the merger, plus other actions to be taken by Safeway, shareholders of Safeway stock are expected to receive total value estimated at $40 per share.
Albertsons’ Chief Executive Officer Bob Miller stated, “This transaction offers us the opportunity to better serve customers by adapting more quickly to evolving shopping preferences in diverse regions across the country. It also brings together two great organizations with talented management teams. Working together will enable us to create cost savings that translate into price reductions for our customers.”
Robert Edwards, president and chief executive officer of Safeway Inc. called merger “one 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,” Edwards said. “We are excited about continuing this momentum as a combined organization.”
The merger is expected to close in the fourth quarter of this year, following the satisfaction of customary closing conditions, including approval of the merger by the holders of a majority of the outstanding shares of Safeway common stock and regulatory approvals including expiration or termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, according to a statement released by the two companies.
Safeway Inc., which operates Safeway, Vons, Pavilion’s, Randall’s, Tom Thumb, and Carrs stores, is a Fortune 100 company and one of the largest food and drug retailers in the United States with sales of $36.1 billion in 2013. The company operates 1,335 stores in 20 states and the District of Columbia.
AB Acquisition LLC, operates ACME, Albertsons, Jewel-Osco, Lucky, Shaw’s, Star Market and Super Saver, and stores under the United Family of stores, Amigos, Market Street and United Supermarkets.
The company is privately owned by Cerberus Capital Management, Kimco Realty Corporation, Klaff Realty, Lubert-Adler Partners, and Schottenstein Stores Corp., and operates 1,075 stores and 14 distribution centers in 29 states and employs approximately 115,000 associates.
Albertsons operates 17 stores in Las Vegas. The metropolitan area has 13 Vons stores.