Supervalu and Albertsons resume buyout dialogue

BOISE — Grocery chain Supervalu Inc. said Friday it has resumed talks to acquire Albertsons Inc., the nation's second-largest traditional supermarket chain.

Albertsons said earlier Friday that it had received a new offer for the entire company from a consortium that had previously made a bid and said it planned to begin negotiations. It did not name the members of the bidding group.

But later in the day, Minneapolis-based Supervalu said in a statement that it was a member of the consortium that had resumed talks with Albertsons.

Neither Supervalu nor Albertsons said how much was being offered. They also cautioned there was no guarantee a deal would be reached.

Albertsons shares rose 24 cents to close at $24.11 on the New York Stock Exchange, while Supervalu lost 34 cents to finish at $31.85.

The announcements came a day after The Wall Street Journal reported Supervalu and a consortium of private-equity investors offered just more than $26 per share for Boise-based Albertsons, which has 47 stores in Utah. Its shares have traded as high as $26.51 over the past 52 weeks.

"I think the market expects a transaction," said Joseph Phillips, senior analyst with Redwood Technimentals Research in New York City. "If the latest deal comes in above $26, there's still a little room for an investor who's willing to take the risk, and it is risky because last time the deal fell through the stock dropped dramatically."

A previous offer — reportedly valued at about $9.6 billion in cash and stock, or about $26 per share — fell apart when the parties could not agree on who would be responsible if antitrust regulators tried to block the deal. At that time, Albertsons said it was no longer considering a sale of the entire company.

The company said Friday it does not expect to disclose more details unless it approves a transaction or ends the talks.

Albertsons is No. 2 behind Kroger Co., with about 2,500 stores including Albertsons, Acme, Shaw's, Jewel-Osco and Sav-on Drugs.

Supervalu has 1,546 owned or licensed retail groceries and 57,000 employees.

The company announced Sept. 2 it was interested in pursuing "strategic alternatives" to increase shareholder value. Albertsons has struggled with lagging sales, a stagnant share price and competition from lower-cost rivals such as Wal-Mart Stores Inc.