Albertsons Companies Inc., a grocery chain owned by Cerberus Capital Management, has filed an initial public offering (IPO) registration on Wednesday, July 8 with the U.S. Securities and Exchange Commission. The move was made after acquiring Safeway in an $8 billion deal.
Boise, Idaho-based Albertsons Companies Inc. is the second-largest U.S. grocery chain after Kroger Co. It employs about 265,000 full- and part-time workers. According to Boston Herald, the company owns 2,205 stores under 18 banner in 33 states. Other supermarket brands include Von, Jewel-Osco, Shaw's, Tom Thumb, Acme, Randalls, Pavilions, Star Markets and United Supermarkets.
Albertsons' IPO filing came when big grocery chains are getting squeezed by mass retailers such as Wal-Mart Stores Inc. and upscale chains such as Whole Foods Market, Reuters noted. And as said by an industry expert, the initial public offering could allow the supermarket chains to regain their competitive sharing.
"Traditional supermarket chains are in a very challenging position and they need to enhance their differentiation, improve their competitiveness. They have a tough game to win," foodservice consultancy Technomic executive vice president Bob Goldin said.
Meanwhile, as per the company's filing with the U.S. Securities and Exchange Commission, Citigroup, Morgan Stanley, Goldman Sachs and Merrill Lynch, Pierce, Fenner & Smith are underwriting the IPO.
The Albertsons grocery chains, however, did not disclose how many shares it would offer, what it would cost or where the shares would trade. Standard Times reported the company only revealed that it expects to raise $100 million from the offering, though that figure is only an estimate used to calculate filing fee and the proceeds from the offering will be used to repay debts and general expenditures.
At the end of the past fiscal year, the Albertsons grocery chains had increased its profits by 35.6 percent to $27.2 billion, apart from Safeway sales. But a year earlier, the company posted a net loss of $1.2 billion compared to a revenue of $1.7 billion. The Safeway acquisition, on the other hand, boosts the revenue figure to $57.5 billion.
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