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Cerberus Said Eyeing Safeway

PLEASANTON, Calif. — Safeway has engaged Goldman Sachs to explore a potential private equity takeover of all or part of the company, according to a Reuters report.

The report said Cerberus Capital Management — the firm that recently acquired Albertsons, Jewel, Shaw’s/Star Market and Acme from Supervalu — is among the firms that are “exploring a deal.”


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The report came just as Safeway received clearance from Canadian authorities for the sale of its 212-store division in that country to Empire Co., the parent company of Stellarton, Nova Scotia-based Sobeys, and after it announced plans to exit the Chicago market through the sale of its 72 Dominick’s stores there.

Neither Safeway nor Cerberus could be reached for comment.

“We would not dismiss the media reports given potential upside from [Safeway]/Cerberus synergies,” said Karen Short, a New York-based analyst with Deutsche Bank, in a research note.

She said a $56 per share offer “would be very reasonable.” Safeway closed at $32.90 on Tuesday.

Earlier this year, private investment firm Jana Capital acquired a 6.2% stake in Safeway, urging it to sell several divisions and prompting Safeway to adopt a poison pill to thwart an unwanted takeover effort.

Read more: Activist Investor Pushes for More Asset Sales at Safeway

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