As a preliminary step toward their merger next month, Albertsons and Safeway said Friday they will jointly divest 168 stores across eight states.
The stores will be acquired by four buyers:
• Haggen, Bellingham, Wash., which will purchase 146 stores in Arizona, California, Nevada, Oregon and Washington.
• Associated Wholesale Grocers, Kansas City, Kansas, which will purchase 12 stores in Texas on behalf of Minyards.
• Associated Foods Stores, Salt Lake City, which will acquire eight stores in Montana and Wyoming; and
• Supervalu, Minneapolis, which will purchase two stores in Washington.
The purchases are all subject to approval by the Federal Trade Commission.
Albertsons and Safeway said in a joint statement the divestitures are being undertaken to secure clearance from the FTC for their merger — a deal they said is expected to close in January.
Under terms of the purchase agreements, the buyers will acquire the divested stores, plus the equipment and inventory, and are expected to hire most, if not all, existing store employees, Albertsons and Safeway said.
According to Robert Edwards, president and CEO of Pleasanton, Calif.-based Safeway, “We’re pleased to have found strong buyers for these stores and to have completed this important step toward combining Albertsons and Safeway.”
The biggest beneficiary of the deal appears to be Haggen, which will expand from 18 stores to 164 after its purchase and add an estimated $750 million in sales to its existing volume of $400 million.