From Deseret News archives:

Investor group buys Albertsons

Fate of 47 stores in Utah is not yet known

Published: Monday, Jan. 23, 2006 8:50 p.m. MST
 |  E-MAIL | PRINT | FONT + - 
MINNEAPOLIS — Supervalu Inc. will more than double in size and become the nation's second-largest traditional grocery-store chain after claiming the lion's share of Albertsons Inc. as part of a $9.7 billion buyout.

According to a statement from the company, Supervalu will acquire all of the Albertsons stores in Utah, Idaho, southern Nevada, Southern California and the Northwestern United States.

Representatives from Albertsons did not immediately respond Monday to Deseret Morning News requests for more information about the fate of the 47 Albertsons stores in Utah.

Minneapolis-based Supervalu and the drugstore chain CVS Corp. led an investment group that said Monday it will buy Albertsons for $9.7 billion in cash and stock. The group made a similar attempt to buy Albertsons about a month ago, but the deal collapsed.

Albertsons stockholders will get about $26.29 in cash and Supervalu stock for each Albertsons share. The buyers are also assuming about $7.7 billion in debt.

Only Kroger Co. will be larger once Supervalu takes over 1,124 stores under the Albertsons, Acme Markets, Bristol Farms, Jewel-Osco and Shaw's Supermarkets banners. The expanded Supervalu will have 2,656 stores nationwide.

Story continues below
Albertsons shares rose $1.31, or 5.4 percent, to close at $25.42 Monday on the New York Stock Exchange, while Supervalu shares rose $2.13, or 6.7 percent, to finish at $33.98 and CVS shares fell 11 cents to $26.96.

Supervalu will pay about $6.3 billion in stock and cash and assume about $6.1 billion in Albertsons debt for the 1,124 stores and in-store pharmacies under the Osco and Sav-on brands.

CVS of Woonsocket, R.I., is purchasing about 700 stand-alone Sav-on and Osco Drugstores and a distribution center in La Habra, Calif., for $2.93 billion in cash. It will also acquire real estate interests in the drug stores for $1 billion.

The other purchasers, led by Cerberus Capital Management, will acquire 655 stores in Dallas/Fort Worth, California, Florida, the Rocky Mountains and the Southwest. The group plans to operate the stores under the Albertsons name.

Larry Johnston, chairman, CEO and president of Albertsons, said the sale "increases shareholder value by capturing strong value for the ongoing business enterprise, monetizing valuable real estate assets, and affording shareowners the opportunity to benefit from a substantial continuing ownership interest in a powerful, growing and vibrant new company."

Following the transaction, approximately 65 percent of the new Supervalu will be held by existing Supervalu stockholders, and approximately 35 percent will be held by Albertsons stockholders.

Comments

You can be the first to comment on this story.

Image

Suzannah Allred and her niece, Addison Morris, take a cart of groceries to their car at Albertsons in Murray on Monday.

previousnext

Latest comments

Utes look toward title showdown

The reason UTAH has a far better chance at beating them, as opposed to provo,...

TCU 42 Utah 10

I pray the Senate will demonstrate some common sense and reject this horrific...

How about Utah's opponents seeming to have more players in Utah's backfield...

It's all about getting re-elected. Of those that can vote for healthcare...

I honestly don't care if gay marriage comes to pass. What does worry me is...

GREAT SEASON South Sevier! Sat. game wasn't a true showing for your Team and...

Utes pound winless Lobos

Utah 3 TCU 45 enough said

Seniors helped BYU regroup

Let the utes start crying about something........

House passes health care bill

Passing of this bill by the house will mark eventully forcing all people...

Advertisements
Advertisement