Challenger claims deal violated terms governing Safeway shares

Albertsons Companies Inc. has announced that it has received a claim that its acquisition of Safeway violated terms governing Safeway notes.

Albertsons' outside counsel received a letter from a law firm purporting to represent more than 45 percent of the outstanding principal amount of Safeway’s 7.25 percent Senior Debentures, due February 2031 (the “SWY 2031 Notes”). Safeway is a wholly owned subsidiary of Albertsons.

The letter asserts that the Albertsons/Safeway financing structure (that has been in place without challenge since the closing of the Albertsons/Safeway transaction in January 2015 and was fully disclosed in the related proxy statement distributed in June 2014) violates a covenant in the indenture governing Safeway notes. The letter requests the SWY 2031 Notes trustee to declare Safeway in default under the terms of the indenture governing Safeway notes.

Albertsons and Safeway believe their financing structure has been—and continues to be—in full compliance with the covenants governing the Safeway notes.

On January 30, 2015 AB Acquisition LLC (the owner of Albertson’s LLC) and Safeway Inc. announced they had completed their proposed merger. Under the terms of the merger Albertsons was to acquire all outstanding shares of Safeway. Safeway shareholders were to receive $34.92 per share in cash.

Wayne Labs has more than 30 years of editorial experience in industrial automation. He served as senior technical editor for I&CS/Control Solutions magazine for 18 years where he covered software, control system hardware and sensors/transmitters. Labs ran his own consulting business and contributed feature articles to Electronic Design, Control, Control Design, Industrial Networking and Food Engineering magazines. Before joining Food Engineering, he served as a senior technical editor for Omega Engineering Inc. Labs also worked in wireless systems and served as a field engineer for GE’s Mobile Communications Division and as a systems engineer for Bucks County Emergency Services. In addition to writing technical feature articles, Wayne covers FE’s Engineering R&D section.

You must login or register in order to post a comment.

This webinar will break down the results of FOOD ENGINEERING’s 2023 State of the Industry report, outlining the issues food manufacturers faced this year and what to expect next year.

This provocative multifaceted presentation will delve into the technology affecting food manufacturing and how companies have put it to work for them. More importantly, this session will share how to implement it and make it work for you.

Products

Food Process Engineering and Technology, 3E

Combining scientific depth with practical usefulness, this book serves as a tool for graduate students as well as practicing food engineers, technologists and researchers looking for the latest information on transformation and preservation processes as well as process control and plant hygiene topics.

See More Products