After aborted Rite Aid deal, Albertsons faces rocky path
Added 08-09-18 03:02:01pm EST - “Albertsons Cos last night called off its merger with Rite Aid that would have provided its private equity owners, Cerberus Capital Management , a long-awaited means to unload its more than decade-old investment.? ?” - Cnbc.com
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Albertsons Cos last night called off its merger with Rite Aid that would have provided its private equity owners, Cerberus Capital Management, a long-awaited means to unload its more than decade-old grocery investment.
The scuttled deal is just the latest in a string of disappointments for Cerberus, which has unsuccessfully tried to shed Albertsons multiple times. Those efforts include an IPO it abandoned at the last minute in 2015 as well as attempts to combine with both Sprouts Farmer Market and Whole Foods Market last year.
Cerberus and a consortium of investors formed Albertsons in 2006 and merged it with Safeway in 2015. But the grocery industry has gotten significantly more difficult over the past decade, and Albertsons now finds itself confronted with fortified competitors and hampered with $12 billion in debt.
The most notable of those challenges is Amazon's acquisition of Whole Foods, which gives Amazon a brick-and-mortar distribution network and brand name it can combine with its powerful Amazon Prime membership program.
It also spurred a furious grocery war with country's largest retailer, Walmart. The giant, which has 5,000 stores cross the U.S. has been investing heavily in technology and focused on going after higher-income shoppers than its traditional base.
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