Bloomberg: Kroger Contacted Safeway About Buying Some Assets

(RTTNews) - U.S. supermarket chain Kroger Co. (KR) recently approached grocery chain Safeway (SWY) Inc. about buying part of its operations, Bloomberg reported, citing people with knowledge of the matter.

Kroger has also contacted private-equity firm Cerberus Capital Management LP, which is the lead bidder for Safeway, about buying some stores that Cerberus may not want. Meanwhile, Safeway is said to prefer to be sold as a whole.

Last month, Safeway reported a surge in profit for the fourth quarter, reflecting a hefty $3 billion gain on disposal of its Canadian operations. The supermarket chain also revealed it is in discussions for a possible sale of the company.

A sale to Cerberus or Kroger may raise concerns of antitrust regulators, and splitting the assets between two firms may help alleviate these worries. Cerberus owns the Albertsons chain.

SWY closed up 1.5 percent at $38.02 on Monday while KR edged up 0.1 percent at $41.99.