Safeway Reveals It’s In Talks That Could Lead to Sale
Safeway, our very own Bay Area-based grocery giant, announced Wednesday it’s in talks that could lead to the company’s sale.
In a statement released as part of the company’s fourth-quarter earnings announcement, Safeway said:
Although the discussions are ongoing, the company has not reached an agreement on a transaction, and there can be no assurance that these discussions will lead to an agreement or a completed transaction. The company will not comment further on these discussions at this time.
The company, which has more than 1,300 U.S. locations and employs 171,000 people, says it’s postponing its investor conference that had been scheduled for early March.
The Wall Street Journal offers this bit of context on today’s announcement of a possible sale:
Activist investor Jana Partners acquired a stake in Safeway last fall and pressed the company to shed some operations in unprofitable regions.
Safeway, which operates grocery stores under its own name and regional chains such as Vons and Randalls, has made several strategic moves in recent months, including separate deals to sell off the company’s Canadian and Chicago stores. Safeway also spun off its gift-card unit into a publicly-traded company, Blackhawk Network Holdings Inc. Jana later reduced its stake in Safeway in December.
For the fourth quarter, Safeway earned $100 million, or 35 cents per share, from continuing operations. Excluding one-time items, it earned 53 cents per share, above the 47 cents per share Wall Street expected.
A year earlier, it earned $170.7 million, or 71 cents per share. Revenue was $11.31 billion, short of the $11.49 billion analysts expected.
Shares jumped 4 percent in late trading.
This post includes reporting from the Associated Press.Related
Category: Business and Finance