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Albertsons is gearing up for IPO

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BOISE, Idaho – Albertsons is preparing for an initial public offering of stock and has reacquired 33 of the stores it was forced by antitrust regulators to sell ahead of its buyout of ­Safeway.

Albertsons last month filed an amended S-1 form with the Securities and Exchange Commission regarding its IPO. The company expects to price more than 65 million shares in the range of $23 to $26. Shares are to be listed on the New York Stock Exchange under the ticker ABS.

Albertsons’ owners — a group led by private investment firm Cerberus Capital Management — will still own 80% of Albertsons common stock after the IPO.

Albertsons was scheduled to price its stock offering on October 14. That plan was rescinded as Walmart’s shares fell 10% on that date after it lowered its earnings forecast for next year by between 6% and 12%, citing spending on its workforce and e-commerce capabilities that will continue into fiscal 2017 as the Bentonville, Ark.-based company seeks to reignite sales growth.

Albertsons is looking to raise roughly $1.5 billion from the IPO to pay down some of the debt it took on to acquire Safeway. It also wants to plow some of the proceeds into renovating stores and making other investments to attract shoppers.

Albertsons intends to improve its fresh, natural and organic offerings. It has said it will roll out some of the private label brands it acquired from Safeway, including O Organics, to all of its outlets.

As of September 12, Albertsons operated 2,196 stores in 33 states and the District of Columbia under 18 banners, including Albertsons, Safeway, Vons, Tom Thumb, Jewel-Osco, Shaw’s and Acme.

As a condition of its Safeway buyout, Albertsons agreed to sell 168 stores to four buyers, including Haggen Inc., the Bellingham, Wash.-based operator of 18 grocery stores in Washington and Oregon.

Haggen acquired 146 Safeway and Albertsons stores in five Western states.

Haggen’s attempt at a rapid expansion into uncharted territory quickly unraveled, however, and the company in September filed for Chapter 11 protection in U.S. Bankruptcy Court for the District of Delaware.

Haggen last month received bankruptcy court approval for the sale of 47 stores, including the 33 that went back to Albertsons.

Earlier, Haggen had sued Albertsons over the sale of the 146 stores, asserting that Albertsons “hoodwinked” Haggen into buying dozens of stores to facilitate its merger with Safeway and then sabotaged Haggen’s entry into the new markets. Albertsons also sued Haggen, claiming that Haggen failed to adequately compensate it for inventory.


ECRM_06-01-22


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