Cerberus Capital Management, L. P., one of the world’s largest private equity firms, leads a group purchasing Safeway, Inc. for $9+billion and merging Safeway with Albertson’s, Inc., already purchased from SuperValu in 2013. Safeway, Inc., also known in California under the names of Golden State, Vons, and Pavilions, is the 2nd largest grocery chain in the United States, while Albertson’s, Inc. is the 5th largest. The merger will reportedly create a considerably larger “2nd largest chain” (second only to The Kroger Company), with 250,000+ employees in 20 manufacturing plants, 27 distribution facilities, and 2,400+ stores, all of which are expected to remain open. If all goes as planned, the deal will be finalized in the 3rd quarter of 2014.
The purchase/merger is certainly not “out of the woods.” Safeway investors filed suit the day after the merger announcement. Slated to receive $40 per share, including $32.50 in cash, Safeway investors reportedly allege that Safeway’s board of directors breached their fiduciary duty to the stockholders by failing to shop around for a more favorable deal. Rigrodsky & Long, P. A., a national law firm with offices in Delaware and New York, is investigating those allegations and other possible violations and is seeking owners of common Safeway stock who purchased those shares prior to March 6, 2014, and wish to give or obtain related information.
By Kathy Catanzarite
Source: Kathy Catanzarite - Handelonthelaw.com Staff Writer
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