Staff and wire reports
MINNEAPOLIS — An investment group led by grocer Supervalu Inc. and drugstore chain CVS Corp. said Monday it will buy Albertson’s Inc., the nation’s second-biggest traditional grocery store chain, for $9.7 billion in cash and stock.
Albertson’s stockholders will get $26.29 per share in cash and Supervalu stock. The investment group made a similar attempt to buy Albertson’s about a month ago, but the deal collapsed. The buyers are also assuming about $7.7 billion in debt.
Apolonia Honorato, a manager at the Albertson’s in Clovis, declined to comment on the effect the sale would have — if any — on the local store.
Minneapolis-based Supervalu will become the nation’s second-largest grocer, behind Kroger Co., with the takeover of 1,124 stores under the Albertson’s, Acme Markets, Bristol Farms, Jewel-Osco, and Shaw’s Supermarkets banners.
Albertson’s shares rose $1.05, or 4.4 percent, to $25.16 in afternoon trading on the New York Stock Exchange, while Supervalu shares rose 93 cents, or 2.9 percent, to $32.78 and CVS shares fell 13 cents to $27.
Supervalu will pay about $6.3 billion in stock and cash and assume about $6.1 billion in Albertson’s debt. Supervalu will also the acquire in-store pharmacies under the Osco and Sav-on brands.
The purchase has been approved by the boards of all the companies involved. If shareholders and regulators also approve, Supervalu will about triple in size to 2,656 stores nationwide, said Jeff Noddle, Supervalu chairman and CEO.
Noddle said combining the leadership at Supervalu with the acquired retail operations will create “a company with better potential for growth and profitability than a stand-alone Supervalu.”
Supervalu spokeswoman Yolanda Scharton said the purchase will expand the company beyond its current base in the East, Southeast and Midwest. “With all this, it’s all states, coast-to-coast and border-to-border,” she said.
The company currently employs about 57,000 people. The Albertson’s properties in the deal have about 144,000 workers. She said it was too soon to say how many of them would remain with the combined companies, but added, “we believe the vast majority of these employees will remain with us.”