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Albertsons Looks To Go Public

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Albertsons Cos. Inc. has filed a registration statement with the Securities and Exchange Commission for a proposed initial public offering of shares of its common stock. The number of shares to be offered and the price range for the proposed offering have not yet been determined. The announcement comes just months after Albertsons merged with Safeway, which was a public company.

Moody’s Investors Service Senior Analyst Mickey Chadha said of the news, “While sooner than we anticipated, Albertson’s S-1 filing detailing its proposed initial public offering demonstrates management’s confidence in the future growth of the company as demonstrated by the improved operating performance across all banners in the year. Although integration and execution risks related to the Safeway acquisition coupled with the high debt burden remain as major risks for the company, we expect the proceeds from the IPO, the final amount of which is yet to be determined, to be used for debt reduction and we therefore view this as a credit positive.”

Goldman, Sachs & Co., BofA Merrill Lynch, Citigroup and Morgan Stanley are acting as joint book-running managers and Lazard is acting as a co-manager and IPO advisor for the proposed offering. The proposed offering will be made only by means of a prospectus. When available, copies of the preliminary prospectus relating to the proposed offering may be obtained from any of the book-running managers.

Albertsons to remodel 115 existing stores, open eight new stores in 2015

The IPO news also comes just days after AB Acquisition LLC, parent company of Albertsons, said it plans to remodel a total of 115 existing stores and open eight new and replacement stores in 2015 across most of its operating divisions.

“Our goal is to be the favorite local supermarket for every one of our shoppers by making sure they have an outstanding experience in our stores. And keeping our stores fresh and up to date is an important component of that,” said Bob Miller, Albertsons chairman and CEO. “We’re investing in making our stores places where customers want to shop and employees want to work, because we know that’s the best way to win in the marketplace.”

The eight new and replacement stores either already opened this year or slated for grand opening in fiscal year 2015 are located in various markets, including Safeway in Hawaii, Northern California and Maryland, United Supermarkets in West Texas and Acme Markets in Long Beach Township, New Jersey.

The new and remodeled stores will feature a number of specialty departments, including bakeries featuring custom cakes by the company’s cake decorators; floral showcasing exclusive designs by Debi Lily; butcher blocks with in-store meat cutters to provide customers with custom cuts; produce departments with a selection of fresh-cut fruits and vegetables; sushi and olive bars near the fried chicken prepared daily by the service deli; as well as many in-store Starbucks locations. Most stores will offer customers one-stop pharmacy services, and many Safeway locations also will offer online grocery ordering and delivery, in addition to services such as Western Union and DVD rentals through Redbox.

Boise, Idaho-based Albertsons is one of the largest food and drug retailers in the U.S. It operates stores in 33 states and the District of Columbia under 18 banners, including Albertsons, Safeway, Vons, Jewel-Osco, Shaw’s, Acme, Tom Thumb, Randalls, United Supermarkets, Pavilions, Star Market and Carrs.

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