Cerberus Capital Management has agreed a deal to buy out the US supermarket chain Safeway in a deal worth billions of dollars.
It was announced yesterday (March 6th) that a deal between the two companies has been struck, with Cerberus adding Safeway to its portfolio, which already includes Albertson's.
The deal is valued at $7.64 billion (£4.56 billion) in cash and it is being reported across the media that it could eventually top $9 billion, making it one of the largest takeovers in recent history.
More than 250,000 people will be employed in total as a result of the merger, while it will mean Cerberus runs over 2,400 stores. No shops are expected to close despite the merger.
Cerberus has been increasing its dominance in this sector in the last few months, with the company making headlines around the world after buying five chains including Albertson's and Jewel-Osco from Supervalu last year.
Albertsons chief executive Bob Miller explained that one of the reasons for the takeover is that it will improve the firm's position when it comes to dealing with suppliers. Mr Miller was revealed to be taking over as the executive of the combined company. Safeway chief executive Robert Edwards is due to retain that title at the combined firm.
British company Tesco has tried to break into the US market in the last few years, but has scaled back its efforts at moving its business across the Atlantic after it found it difficult to build up a reputation from scratch in the country.
Safeway shareholders are expected to receive $32.50 per share in cash as a result of the takeover deal, plus other distributions with a value of $3.65 per share.
Although the merger is subject to the usual shareholder and regulatory approval, it is expected that final confirmation of the purchase of Safeway by Cerberus could be completed in the final quarter of the year.
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