Kroger’s planned acquisition of Albertsons passed another hurdle on Friday when Albertsons’ special payout to shareholders went ex-dividend.
Going ex-dividend means Albertson’s shareholders of record on Oct. 24 will receive a one-time payout of $6.85 per share on Nov. 7.
The dividend had been planned as part of Kroger’s $24.6 billion purchase of Albertsons that was announced earlier this month.
Across the Las Vegas Valley, Kroger operates 38 Smith Food and Drug-branded stores, and Albertsons operates 31 stores that carry either the Albertsons or Vons nameplate, KLAS-TV Channel 8 reported.
Across the U.S., the two companies have about 5,000 locations or 13 percent of the U.S. grocery market. Walmart is the leader with 22 percent of the market.
Also on Friday, several news outlets reported the deal could face serious regulatory scrutiny. Such a review might force the companies to sell more stores to gain approval. As part of the condition of the purchase, the companies have agreed to sell as many as 650 stores and also break out 100 to 375 locations as an Albertson’s subsidiary called SpinCo.
Rodney McMullen, Kroger chairman and CEO, would lead the combined company, Supermarket News originally reported. Kroger is based in Cincinnati. Abertsons is headquartered in Boise, Idaho.
In total, Kroger and Albertsons generated about $210 billion in revenue, $3.3 billion in net earnings and $11.6 billion of adjusted EBITDA in fiscal-year 2021, Supermarket News also reported.
If the deal were to go through, would Kroger keep its Smith, Albertsons and Vons brands in the Las Vegas Valley? We asked that question of a front-line Albertson’s employee after the deal was first announced on Oct. 14.
“No idea,” the employee said. “We haven’t been told a thing.”
Albertson shares closed on Friday at $21.08, up 43 cents or 2.08 percent, well off the offer price of $34.10, reflecting skepticism the deal with go through as planned and also the special dividend. Kroger shares were up $1.47 or 3.47 percent to close at $43.63.
