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Sobeys completes acquisition of Safeway’s Canadian assets

RBR Staff Writer Published 05 November 2013

Sobeys, a Canadian food retailer and a 100% owned subsidiary of Empire Company, has completed the sale of the net assets of Safeway in Canada.

The sale process was in accordance with the asset purchase agreement announced on 12 June 2013 and the consent agreement with the Competition Bureau announced on 22 October 2013.

The sale is a part of company's plan to finance the acquisition of Safeway's Canadian businesses in a deal worth C$5.8bn.

The acquired properties are located across Western Canada, with 39.6% gross leasable area in British Columbia, 42.6% in Alberta, 4.8% in Saskatchewan, and 13% in Manitoba.

The company noted that proceeds from the transaction and $400m-$450m in US tax benefits related to the exit of the Chicago market will be used to pay down $2bn of debt, with the majority of the remainder to be used to buy back stock.

In addition, some of the proceeds may be used to invest in growth opportunities.

Safeway presently operates 1,406 stores in the US which had annual sales of $37.5bn in 2012.