Albertsons board gives CEO a show of support

Albertsons Inc.'s board said it supports Chief Executive Officer Larry Johnston after the grocery chain abandoned talks to sell the company last week.

"As the 11 independent members of the Albertsons board of directors, we continue to be unanimously supportive of our CEO Larry Johnston," Albertsons board said in a statement e-mailed to Bloomberg News. "The board was in total agreement on every step of the process and after thorough consideration, unanimously agreed, voting 12 to 0, to reject the proposal."

Albertsons last week turned down a bid by a group including Supervalu Inc., owner of Save-A-Lot and Shop 'n Save stores; CVS Corp.; and investors Kimco Realty Corp. and Cerberus Capital Management LP to buy the struggling supermarket's grocery stores and stand-alone drug business. The Boise-based chain said it's in talks about selling some of its underperforming assets.

Johnston had been seeking a buyer since September after competition from lower-priced and upscale stores and a 20-week strike led to profit declines in three of the past four years. Albertsons is losing market share to Wal-Mart Stores Inc. after the discounter expanded to more than 1,000 super centers that offer low-priced groceries.

The decision to halt the sale of the entire company sent shares tumbling 12 percent on Dec. 23. The New York Times reported Dec. 22 that Albertsons' board rejected a $9.6 billion takeover offer from investors including CVS, citing unidentified people close to the negotiations.

"We want to stress that the board has never wavered in its confidence in Larry," the board said in the statement. "We continue to have full confidence in Larry's ability to lead this company forward."

Albertsons shares rose 28 cents, or 1.3 percent, to close at $21.10 Wednesday on the New York Stock Exchange. They have fallen 12 percent this year.