PLEASANTON, Calif. (AP) — Safeway says it has agreed to be acquired by an investment group led by Cerebus Capital Management, the owner of Albertsons and several other supermarket chains.
The acquisition is worth about $7.64 billion in cash, and pending other transactions could top more than $9 billion. No store closures are expected as a result of this transaction.
It comes amid ongoing consolidation in the supermarket industry, which is facing growing competition from big-box retailers, specialty chains, drug stores and even dollar stores.
According to a press release on Albertson’s website, customers can expect lower prices and other benefits. “Realizing substantial cost savings will allow for investments that are expected to benefit customers, including price reductions as well as store remodels and refurbishments. The diversified network of retail assets, associated distribution centers and manufacturing assets will allow for a broader assortment of products, a more efficient distribution and supply chain, enhanced fresh and perishable offerings, and expanded private label alternatives for customers.” (Read the full release here.)
Cerberus bought five chains including Albertson’s and Jewel-Osco from Supervalu Inc. last year. Kroger Co. also recently snapped up regional chain Harris Teeter.
Safeway shareholders will receive $32.50 per share in cash. Pending other deals, the company says the deal is worth roughly $40 per share to stockholders.
Shares of Pleasanton, Calif.-based Safeway Inc. closed at $39.47 Thursday.
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