BOISE, Idaho and PLEASANTON, Calif., Jan. 30, 2015 /PRNewswire/ -- AB Acquisition
LLC and Safeway Inc. (NYSE: SWY, "Safeway") announced today that
they have completed their proposed merger. Under the terms of the
merger agreement first announced and unanimously approved by
Safeway's Board of Directors in March
2014, AB Acquisition LLC, the owner of Albertson's LLC and
New Albertson's, Inc. (collectively "Albertsons"), will acquire all
outstanding shares of Safeway. AB Acquisition is controlled by an
investor group led by Cerberus Capital Management, L.P.
("Cerberus"), which also includes Kimco Realty Corporation
(NYSE:KIM), Klaff Realty LP, Lubert-Adler Partners LP, and
Schottenstein Stores Corporation.
Safeway shareholders will receive $34.92 per share in cash, consisting of (i)
$32.50 in initial cash consideration,
(ii) $2.412 in consideration relating
to the previously announced sale of the assets of Safeway's
real-estate development subsidiary Property Development Centers,
LLC ("PDC") and (iii) $0.008 in
consideration relating to a dividend of approximately $2 million (after deduction for taxes at an
assumed rate) that Safeway received in December 2014 on its 49% interest in Mexico-based food and general merchandise
retailer Casa Ley, S.A. de C.V. ("Casa Ley"). In addition,
shareholders will receive contingent value rights entitling them to
pro rata proceeds relating to deferred consideration from the sale
of PDC and any proceeds from the sale of Safeway's 49% interest in
Casa Ley.
Both contingent value rights will be non-transferable and
non-tradable. For tax reporting purposes, Safeway intends to
report that the fair market values of the contingent value rights
at the time of the merger for PDC and Casa Ley are $0.0488 and $1.0149, respectively, per share, based on third
party valuations.
With respect to PDC, both the initial cash distribution
($2.412 per share) and the total
estimated asset value including the CVR ($2.461 per share) have increased slightly over
the estimated values set forth in Safeway's December 23, 2014 press release announcing the
sale of PDC. Those earlier estimates were $2.38 per share and $2.45 per share, respectively.
In addition, in April 2014,
Safeway stockholders received a distribution of stock in Safeway's
former Blackhawk Network Holdings, Inc. (NASDAQ: HAWKB) subsidiary
valued at approximately $4.02 per
Safeway share at the time of the distribution.
As a result of the completion of the merger transaction, the
common stock of Safeway will no longer be listed for trading on the
New York Stock Exchange or any other securities exchange. Safeway
will file a Certification on Form 15 with the U.S. Securities and
Exchange Commission under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), to suspend Safeway's reporting
obligations under Sections 13(a) and 15(d) of the Exchange Act.
Merger Closing Paves
Way for Enhanced Shopping Experience
"We plan to be the favorite local supermarket in every community
we serve," said Safeway President and Chief Executive Officer
Robert Edwards, who becomes
President and CEO of the newly combined company, effective
immediately. "We will do this by knowing, listening to, and
delighting our customers; providing the right products at a
compelling value; and delivering a superior shopping
experience. We will also continue to be active members of our
local communities."
As previously announced, current Albertsons Chief Executive
Officer Bob Miller will become
Executive Chairman.
"This is a transformative day for both Albertsons and Safeway.
This merger creates a unified, strong organization that is
dedicated to bringing a better shopping experience to more
customers across the country," commented Miller. "Our combined
geographic footprint, vast range of brands and products, and
service-oriented staff will enable us to meet evolving shopping
preferences."
The merger will create a diversified network that includes 2,230
stores, 27 distribution facilities and 19 manufacturing plants with
over 250,000 employees across 34 states and the District of Columbia.
The new company will be comprised of three regions and 14 retail
divisions, supported by corporate offices in Boise, ID, Pleasanton, CA, and Phoenix, AZ. Banners will include Safeway,
Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, ACME,
Jewel-Osco, Lucky, Shaw's, Star
Market, Super Saver, United Supermarkets, Market Street and
Amigos. In December, the companies announced the sale of 168 stores
to four separate buyers, as divestitures required in order to
secure U.S. Federal Trade Commission approval of the
transaction.
Advisors
Goldman, Sachs & Co. served as
financial advisor to Safeway in connection with the Company's
strategic review and the transactions. Greenhill & Co. has also
served as financial advisor to Safeway. Latham & Watkins LLP
served as Safeway's outside legal counsel, and The Law Offices of
Richard C. Weisberg served as
outside legal counsel on antitrust matters. Citigroup, lead
financial advisor, Bank of America Merrill Lynch and Credit Suisse
served as financial advisors to Albertsons, Cerberus and the
investor group. Schulte Roth &
Zabel LLP served as lead outside legal counsel to Albertsons,
Cerberus and the investor group, and Dechert LLP, Schulte Roth & Zabel LLP and Baker Botts LLP
served as outside legal counsel on antitrust matters.
About Safeway Inc.
Safeway Inc., which operates Safeway, Vons, Pavilions, Randalls,
Tom Thumb, and Carrs stores, is a Fortune 100 company and one of
the largest food and drug retailers in the United States with sales of $35.1 billion in 2013. The company's common stock
previously traded on the New York Stock Exchange (NYSE) under the
symbol SWY, and will be delisted from the NYSE as a result of the
closing of the merger. For more information, please visit
www.Safeway.com.
About Albertsons
Established in 2006, AB Acquisition
LLC ("Albertsons"), which operates ACME, Albertsons, Jewel-Osco,
Lucky, Shaws, Star Market and Super
Saver, and stores under the United Family of stores, Amigos, Market
Street and United Supermarkets, is working to become the favorite
food and drug retailer in every market it serves. The company is
privately owned by Cerberus Capital Management, Kimco Realty
Corporation, Klaff Realty, Lubert-Adler Partners, and Schottenstein
Stores Corporation. For more information, please visit
www.Albertsons.com.
Media Contacts:
Brian Dowling
brian.dowling@safeway.com | 925-467-3787
Investor Contacts:
Christiane Pelz
christiane.pelz@safeway.com | 925-467-3832
Melissa Plaisance
melissa.plaisance@safeway.com | 925-467-3136
http://investor.safeway.com
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SOURCE Safeway Inc.
