Albertsons Companies advertising & marketing assignments

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Albertsons Companies, formed from the 2015 merger of the existing Albertsons business with rival Safeway, is the second largest traditional supermarket group in the US (behind Kroger) and #3 groceries retailer overall (behind Walmart). It oversees an extensive collection of more than 20 different regional supermarket banners. Albertsons and Safeway get top billing, but the collection also includes Vons, Jewel-Osco, Shaw's, Acme, Tom Thumb, Carr's, Star Market and others. As of 2019, the group operated a network of 2,270 stores across 35 states, mainly in the western, central and north-eastern US. More than 75% of stores also contain an instore pharmacy. The different store banners share the parent group's collection of private label brands, which include Signature Select, Signature Cafe, Lucerne and O Organics, each of which has retail sales in excess of $1bn a year. In 2017, the group acquired meal kits service Plated. The current group was formed from a series of complicated deals engineered by private equity fund Cerberus Capital Management, which is also the biggest shareholder in Albertsons' previous owner, the discount groceries group Supervalu. In 2015, Cerberus announced plans for an IPO of Albertsons Companies' stock, but this was quietly abandoned a year later. An alternative route to a listing presented itself in 2018: Albertsons said it would merge into quoted pharmacy group Rite Aid in a deal that would create a group with revenues of over $80bn. However, that arrangement too was subsequently cancelled as a result of opposition from Rite-Aid's institutional shareholders. A fresh approach is expected from new CEO Vivek Sankaran, recruited from PepsiCo in 2019. One possibility could be merger with another leading US grocer. Revenues for the year to Feb 2019 edged up to $60.5bn with net income of $131m.

Capsule checked 9th July 2019

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Historical profile information for Albertsons / Safeway

Recent stories from Adbrands Update:

Adbrands Daily Update 1st Apr 2019: America's third biggest food retailer Albertsons Companies - owner of Albertsons, Safeway, Vons and other supermarket chains - announced the appointment of senior PepsiCo manager Vivek Sankaran as its new CEO. He takes over from former Starbucks and Haggen executive Jim Donald, who moves up to co-chairman after only six months in the CEO role, sharing that position with Leonard Laufer, a senior managing director at Albertsons' owner Cerberus Capital. Sankaran is moving from PepsiCo only three months after being promoted to CEO of North America Foods. He is being replaced in that role by Steven Williams.

Adbrands Weekly Update 9th Aug 2018: US pharmacy chain Rite-Aid - or rather what remains of that group following the sale of almost half its outlets to Walgreens last year - hit another corporate speed bump with the cancellation of its merger with supermarket group Albertsons. That followed growing opposition from Rite-Aid's leading institutional shareholders who said the proposed deal undervalued the company and gave Albertsons too much control over the combined business. An earlier arrangement whereby all of Rite-Aid would have been acquired by Walgreens Boots Alliance was also called off as a result of regulatory problems.

Adbrands Weekly Update 18th Apr 2018: Tax reforms allowed privately owned US supermarket Albertsons to claw a net profit for its year to Feb 2018, despite a 1% decline in same-store sales. Net income came in at $46m, helped by a one-off gain of $964m. For the previous year, the group reported a $373m net loss. Revenues edged up only marginally to just under $60bn. A key element in Albertsons' future plans is the planned merger into publicly quoted Rite-Aid. The merged company would operate about 4,900 stores - including more than 4,300 pharmacies and over 300 retail health clinics - and generate pro forma combined sales of $83 billion. All it needs is approval from Rite-Aid's shareholders, who are due to vote in July this year. Rite-Aid's board has already given its firm support, but some shareholders believe the proposed deal undervalues their group and are wary of exposure to the hard-pressed grocery sector. A green light may be no sure thing.

Adbrands Weekly Update 22nd Feb 2018: America's #3 food retailer Albertsons - owner of a collection of regional banners including Safeway, Vons, Jewel-Osco, Shaw's and others - has agreed to acquire the rump of the Rite-Aid pharmacy group. A little under half of the Rite Aid estate is already being acquired by larger rival Walgreens Boots Alliance. The merger of Albertsons with the remainder of Rite Aid will create a group with sales of around $83bn and some 4,900 locations nationally. Most Albertsons outlets already have an instore pharmacy; these adopt the Rite Aid brand, and the company will also continue to operate stand-alone pharmacies under the Rite Aid name. The combined business will also retain Rite Aid's public listing. Private equity-owned Albertsons has been considering its own IPO for several years; this new merger offers a far more attractive route to market. Rite Aid's existing shareholders are expected to end up with around 29% of the merged group; Albertsons' owners, led by Cerberus Capital, will hold the remainder of shares. Rite Aid's John Standley will be CEO of the combined business; Albertsons' Bob Miller will be chairman.

Adbrands Weekly Update 27th Apr 2017: Privately owned supermarket group Albertsons is weighing up a bid for upscale grocer Whole Foods Market. Albertsons is the third largest food retailer in the US following its takeover of Safeway in 2015, but it still lags well behind leaders Walmart and Kroger. A deal for Whole Foods would narrow that gap a little, and also widen Albertsons' exposure to high-end customers, but could prove quite a stretch financially. A successful offer would probably need to be in the region of $15bn, around two-thirds more than Albertsons paid for Safeway. Whole Foods reported record revenues in 2016 of $15.7bn, but profits have been under intense pressure from other bricks and mortar groups as well as online competitors like Amazon. It is currently the 10th largest food retailer in the US.


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