BOISE, Idaho, and PLEASANTON, Calif. — The Federal Trade Commission has approved the proposed merger of supermarket operators Safeway Inc. and AB Acquisition LLC, the parent company of Albertsons.
The food and drug retailers said Tuesday that they expect to close the merger within the next five business days. Under the more than $9 billion deal, announced in early March, AB Acquisition, which is an affiliate of Cerberus Capital Management LP, will acquire Safeway.
The FTC’s clearance comes after Albertsons and Safeway agreed to a consent order that includes the divestiture of 168 stores. The two supermarket chains have entered into agreements to sell stores to Associated Food Stores (eight stores), Associated Wholesale Grocers/Minyard (12 stores), Supervalu Inc. (two stores) and Haggen Inc. (146 stores).
Albertsons and Safeway have also agreed to settlements with the attorneys general of California, Nevada and Washington.
The deal will bring together the two chains’ rosters of supermarket banners, including Safeway, Vons, Pavilions, Randalls, Tom Thumb, Carrs, Albertsons, ACME, Jewel-Osco, Lucky, Shaw’s, Star Market, Super Saver, United Supermarkets, Market Street and Amigos. Combined, the company will have more than 2,400 stores, 27 distribution facilities and 20 manufacturing plants with over 250,000 employees.
The merger also will create a bigger player in the retail pharmacy market. Together, Safeway and Albertsons will have nearly 2,000 pharmacy locations.
Bob Miller, Albertsons’ current chief executive officer, is slated to become executive chairman. Robert Edwards, Safeway’s current president and CEO, will serve as president and CEO of the merged company.