Exaclty, it decreases competition, decreases the number of stores, increases prices, etc. Why have regulators if they won't kill these megadeals that really only help the corps involved and harm the public interest everywhere else.
This is not private equity. Kroger is a publicly listed company, and so is Albertsons.
I suspect the reason for this is Albertsons is facing heavy competition from other grocery stores, their financials look terrible.
A lot of established grocery stores are getting upended at the lower end by Aldi/Lidl/Walmart/Target/Costco, and at the higher end by Whole Foods/Trader Joes/etc.
Kind of reflects income/wealth gap trends. You are either selling at the lowest prices, or you are selling at higher prices to a niche population on the rich side of town.
Edit: ignore this comment, I had wrong information.
Most certainly is private equity. Didn’t read the article?
The 4b special dividend that will be issued will go to two PE firms. According to the author’s analysis this will strip out the working capital and enrich the PE participants. Likely sending the company and by extension the workers to the debt markets.
I didn’t read the financials but if true this is just shithead financial engineering. :(
I was wrong to write that the deal is not private equity, it is setup by private equity firms, but it is up to all the other investors to see if they want to go ahead with the deal, hence the need for a shareholder vote.
I do not see how the special dividend can legally go to two firms. It would have to go to all shareholders.
Cerebrus does own 150M/475M shares = 30% of Albertsons, but for some reason, I do not see Apollo in the list of top shareholders.
