Boise, Idaho – Shares of Boise-based Albertsons Inc. gained 34 cents to close at $24.33 Friday after a published report indicated that an investment group is nearing a deal to purchase the nation’s No. 2 grocer by sales.
Cerberus Capital, Kimco Realty Corp. and Minnesota-based supermarket chain Supervalu Inc. could purchase the company for about $9.6 billion, The Wall Street Journal reported Friday.
The deal, which the newspaper said was valued at $26 a share, would end a three-month auction for Boise-based Albertsons, which has suffered from lagging results, a stagnant share price and competition from lower-cost rivals, including Wal-Mart.
In Colorado, Albertsons has struggled to compete, and it ranks fourth in market share behind King Soopers, Safeway and Wal-Mart, according to September data from The Shelby Report of the Southwest, a grocery industry publication. The company has shuttered four metro- area stores this year and now operates 55 stores in the state.
Some experts have predicted a buyer may seek to sell off Albertsons’ Colorado operations, along with those in other struggling markets such as Arizona, Texas and Florida.
“What are you buying if you buy all the assets of the fourth- ranked chain in the market?” said Kevin Coupe, founder and editor of MorningNewsBeat.com, a Darien, Conn.-based website for the food retailing and manufacturing business.
Coupe predicted that if the buyer sheds Albertsons’ Colorado operations, the stores will be sold piecemeal.
King Soopers declined to comment on whether the chain would pursue any Albertsons locations should they become available. When SuperValu closed nine Cub Foods stores in 2003, King Soopers bought four stores – in Arvada, Lakewood, Aurora and Glendale – and a distribution center in Aurora.
Safeway representatives did not return a message Friday.
The Journal, which cited anonymous sources, also said Albertsons is continuing separate talks to sell its pharmacy business to CVS Corp. for as much as $4 billion of the overall purchase price.
“Beyond the Sept. 2 announcement, I have no comment,” said Shannon Bennett, an Albertsons spokeswoman. The company put itself up for sale on that date. She also refused to confirm the newspaper’s report that its board planned to meet this weekend.
The Journal said the transaction could be announced after the board meeting. According to the report, the Cerberus group would assume $6.4 billion in Albertsons debt as part of the deal.
Spokesmen for Cerberus, based in New York; Stamford, Conn.-based Kimco; and Eden Prairie, Minn.-based Supervalu did not immediately return phone calls seeking comment.
Albertsons was founded in 1939 on a downtown Boise street corner by Joe Albertson, who was among the first American grocery retailers to combine supermarkets with drugstores.
