Grocer Albertsons, Inc. went on the block last week, putting about 70 million square feet of prime retail real estate into play.
Albertsons hired Goldman Sachs & Co. and The Blackstone Group as financial advisors with an eye toward selling the company. The Boise-based retailer has 2,500 stores in 37 states, with fiscal 2004 sales of $39.9 billion. The company could fetch as much as $10 billion, plus assumption of another $6.5 billion in debt, per news reports.
Albertsons’ sales rose 10% to $10 billion for the first quarter ended May 5, 2005, due mostly to Albertsons’ acquisition of Shaws Supermarkets. Same-store sales were up only 1.8%. Second-quarter sales will be announced today.
Bidders likely will be more interested in Albertsons’ real estate than its grocery business: Albertsons owns a reported 60% of its space, with the rest under lease. No. 1 grocer Kroger Co. (2004 sales: $56.4 billion) and No. 3 Safeway (2004 sales: $35.8 billion) are unlikely to vie for Albertsons, given antitrust concerns.
