(Reuters) – AB Acquisition LLC, the holding company that owns Safeway Inc, has hired IPO bankers to plan an initial public offering for the grocery store chain later this year, CNBC reported, citing sources with knowledge of the matter.
The IPO would raise more than $500 million, but the timing and size of the offering remains fluid, CNBC cited the sources as saying. (cnb.cx/1Jv9rzJ)
AB Acquisition is controlled by private equity firm Cerberus Capital Management, Kimco Realty Corp, Klaff Realty, Lubert-Adler Partners and Schottenstein Stores Corp.
Safeway, which operated 1,326 stores in the United States as of Jan. 3, was taken private by Cerberus this year for about $9.4 billion.
The deal combined Safeway with Cerberus’ Albertsons chain, creating a dominant grocery franchise on the West Coast with a network of about 2,300 stores and 250,000 employees.
Based on retail sales, Albertsons and Safeway together had the second-largest market share among super market chains in the United States in 2014, according to data research firm Euromonitor. Kroger Co (KR.N) had the biggest market share.
AB Acquisition spokesman Brian Dowling said the company “does not comment on rumors”. Cerberus was not immediately available for comment.