From Deseret News archives:
Albertsons calls off all talks about its potential sale
Discussions continue on the sale of some assets, retailer says
Discussions continue with "several parties" that are interested in buying its underperforming assets, the Boise-based company said in a statement distributed by PR Newswire. Albertsons spokeswoman Shannon Bennett didn't immediately return a message left at her office.
Supervalu Inc., the owner of Save-A-Lot and Shop 'n Save stores that is based in Eden Prairie, Minn., said in a statement late Thursday that a group of companies agreed with Albertsons to end acquisition talks.
CVS Corp., the No. 2 U.S. drugstore chain, said earlier Thursday that it ended discussions to purchase Albertsons standalone Sav-on and Osco drugstores, according to a separate statement from the company, based in Woonsocket, R.I.
Albertsons shares, which fell 78 cents to $22.50 in extended U.S. trading, declined 82 cents, or 3.4 percent, to close at $23.28 in New York Stock Exchange composite trading Thursday. The shares are down 2.5 percent this year.
The New York Times had reported Thursday that Albertsons' board rejected a $9.6 billion takeover offer from a group of investors including CVS, citing unidentified people close to the negotiations.
Investors are concerned they'll receive less than the $26 a share reported in the paper if Albertsons is sold piecemeal rather than all at once. Albertsons, whose grocery chains include Acme, is seeking a buyer after competition from Wal-Mart Stores Inc. and a 20-week strike led to profit declines in three of the past four years.
"People were looking for a quick $26 and to go home, and now there is that uncertainty," said David Dietze, president of Point View Financial Services in Summit, N.J., which manages about $100 million, including Albertsons shares. "Will they be able to find a new set of players?"
Supervalu Inc., Cerberus Capital Management LP, Kimco Realty Corp. and CVS were bidding for Albertsons, the New York Times said.
"While a deal might still be completed for Albertsons, we believe the risk/reward profile has turned decidedly more negative if the reported $26 cash/stock bid was rejected," Bear Stearns & Co. Inc. analyst Robert Summers, who has an "underperform" rating on the stock, --> wrote in a report. "We find it unlikely that another bidder emerges for a more attractive offer."
Contributing: Josh Fineman
