Buyout Firms Eyeing Safeway

Several buyout firms, including Cerberus Capital Management LP, are exploring a deal for all or part of supermarket chain Safeway Inc., according to published reports.

Safeway, which is not currently up for sale, recently became aware of the buyout interest when New York-based Jana Partners, LLC, which disclosed an activist stake of 6.2 percent in a company filing, stated that the grocer was undervalued and that it was discussing strategic alternatives including replacing management.

The grocer has adopted a one-year stockholder rights plan that its board believes will ensure that it remains in the best position to discharge its fiduciary duties.

Published reports signal that Safeway is now reviewing options with advisor Goldman Sachs Group Inc.

Minneapolis-based Supervalu Inc. recently completed the $3.3 billion sale of its Albertsons, Acme, Jewel-Osco, Shaw’s and Star Market stores and related in-store pharmacies to AB Acquisition LLC, an affiliate of Cerberus.