Supervalu Joins Albertsons’ Suitor List
By George Anderson
According to a report in the Financial Times, Kroger is no longer in the running to buy Albertsons but now Supervalu has stepped up to join with Cerberus Capital Management and Kimco Realty to make an offer on the grocery and drugstore chain.
Also considered among the likely bidders is an investment group that includes Apollo Management, Kohlberg Kravis Roberts & Co. and Texas Pacific Group, and another with Yucaipa and Dubai Investment Group. CVS has also been rumored as having an interest in purchasing Albertsons drugstore operations.
Bids are said to be due today with a possible decision made on the deal this month.
Some were skeptical about whether the rumored bid, should it be accepted, made sense for Supervalu.
Eric Larson, a food industry analyst at Piper Jaffray Cos., told the Pioneer Press, “That’s a big bite; that’s a $16 billion bite. Everything’s a possibility, but I would think that would be a bit much. It really isn’t part of what I would call Supervalu style.”
Jean Kinsey, director of the University of Minnesota’s Food Industry Center, sees the logic in a Supervalu bid. “One of the ways that a company like Supervalu stays in business is to have stores you can deliver to,” she said. “You are guaranteeing (buying Albertsons) your business.”
Moderator’s Comment: Does a deal for Albertsons involving Supervalu make sense for either company? What will the eventual winner of the bidding for Albertsons
need to do to improve its competitive position? –
George Anderson – Moderator
- Three groups put finishing touches to Albertson’s bids – Financial Times
- Supervalu eyes chain – St. Paul Pioneer Press