Albertsons orders review, raising question about future ownership. Here’s what we know
The board of Albertsons Companies says it has undertaken a strategic review to enhance the Boise company’s growth and maximize shareholder value.
The review comes less than two years after Albertsons began offering shares of its stock to the public.
“The board believes the continuing strength of our business and the scale of our portfolio of assets warrants a deep and considered review of all possible paths toward maximizing value creation,” Chan Galbato, the board’s co-chair. said in a news release.
Albertsons, which operates 2,278 stores in 34 states under banners for Albertsons, Safeway, Haggan, Jewel-Osco and 16 other brands, retained bankers from Goldman Sachs Group and Credit Suisse Group to advise it. Albertsons said it has not set a timetable for completing the review.
The Idaho company gave no indication of what direction Albertsons might go following the review. It said it would not comment further.
“There can be no assurance that the review will result in any transaction or other strategic change or outcome,” it said.
Albertsons has seen sales and profits rise during the past two years as the coronavirus pandemic led families to cook meals more at home. The chain is the nation’s second-largest grocer behind Kroger Co., the Cincinnati-based parent of Portland’s Fred Meyer.
Albertsons’ shareholders seemed to like news of the review, announced late Monday afternoon. The company’s stocks were up 7.7% Tuesday, closing at $31.40.
The stock has doubled since the Albertsons went public in June 2020, three months after the pandemic began. The price has risen 89% over the past year.
Besides seeing sales rise, Albertsons has also administered more than 11 million COVID-19 vaccinations since early 2021, adding millions of dollars to its coffers.
Last month, Albertsons partnered with DoorDash to offer grocery deliveries in less than 30 minutes. The service, available initially at more than 300 stores, has a selection of more than 6,000 products, including milk, eggs, fruits and vegetables and snack.
Today’s Albertsons Companies is a descendant of Albertsons Inc., a publicly traded company that broke up in 2006 after years of losses.
An investment consortium led by Cerberus Capital Management, a New York private-equity firm, bought some of its stores. Supervalu, a Minnesota company grocery wholesaler, bought the rest, including the Albertsons stores in Idaho. Both sold or closed some stores, but Supervalu still couldn’t make a go of it, so it sold its remaining stores to the Cerberus consortium in 2013, reuniting what remained of the two Albertsons chains.
Albertsons more than doubled in size in 2015 when it merged with Safeway.
Cerberus still owns about 31% of Albertsons, the Wall Street Journal reported.
This story was originally published March 1, 2022 at 6:49 PM.
