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CHICAGO -- Albertsons Osco drugstore division here is being scrutinized for possible acquisition by two bidders, Deerfield, Ill.-based Walgreen Co. and CVS Corp. of Woonsocket, R.I., which are said to be competing for the nearly 800-unit operation.
Private hedge fund investor groups are leading three groups bidding for both the drugstore and grocery store parts of Boise-based Albertsons, including the 188 Jewel/Osco stores and 14 free-standing Jewel stores in the Chicago area.
Albertsons, with 2,300 stores across the country, put itself on the market in September after posting profit declines in three of the past four years.
Most analysts expect a private equity group to win the bidding and then sell off the various parts, including the drugstores that it doesn't want. Further, many in the investment banking community believe it is unlikely CVS or Walgreens would bid on the combination drug-and-grocery stores in the Chicago market.