Safeway Inc. Announces Settlement of Certain Actions in Connection With the Proposed Merger
June 16 2014 - 08:00AM
Marketwired
Safeway Inc. Announces Settlement of Certain Actions in Connection
With the Proposed Merger
PLEASANTON, CA--(Marketwired - Jun 16, 2014) - Safeway Inc.
(NYSE: SWY) ("Safeway") today announced its entry into a memorandum
of understanding to settle the consolidated class action pending in
the Court of Chancery of the State of Delaware filed on behalf of
alleged Safeway stockholders against Safeway in connection with
Safeway's proposed merger with an affiliate of AB Acquisition
LLC.
The memorandum of understanding provides for, among other
things, (i) an amendment to the definitive merger agreement to
adjust certain provisions of the Casa Ley contingent value rights
agreement (the "Casa Ley CVR Agreement") and the PDC contingent
value rights agreement (the "PDC CVR Agreement"), each of which
were previously attached as exhibits to the definitive merger
agreement, (ii) an agreement by Safeway to terminate Safeway's
stockholder rights plan, commonly referred to as a "poison pill,"
effective June 19, 2014, and (iii) certain changes to the proxy
statement filed in connection with the proposed merger, which
changes will be captured in the definitive proxy statement that
Safeway intends to file with the U.S. Securities and Exchange
Commission ("SEC").
While Safeway has entered into the memorandum of understanding
and an amendment to the definitive merger agreement and has
accelerated the expiration date of the stockholder rights plan to
June 19, 2014, the settlement will be subject to the approval of
the Delaware Chancery Court. Safeway and the Board of
Directors of Safeway believe the claims are entirely without merit,
and in the event the settlement does not resolve them, intend to
vigorously defend these actions.
The changes to the terms of the PDC CVR Agreement provide that,
among other things, the holders of the contingent value rights
under the PDC CVR Agreement would, instead of not receiving any
value for any assets of Safeway's shopping center portfolio that
remain unsold at the end of the two year sale deadline period under
the PDC CVR Agreement, be entitled to the fair market value of the
unsold assets (net of certain expenses, fees and taxes).
The changes to the terms of the Casa Ley CVR Agreement, among
other things, shorten the sale deadline period from four years to
three years. In the event any of the equity interests of Casa Ley,
S.A. de C.V., a Mexico-based food and general merchandise retailer
("Casa Ley"), owned by Safeway remain unsold as of the sale
deadline period, the determination of the fair market value that
the holders of the contingent value rights under the Casa Ley CVR
Agreement would be entitled to at the end of the sale deadline
period would exclude any minority, liquidity or similar discount
regarding such equity interests.
Originally scheduled to expire on September 15, 2014, Safeway's
Board has amended the rights plan to accelerate the expiration date
to June 19, 2014, effectively terminating the plan and the rights
issued under the plan as of that date. Accordingly, upon
termination, Safeway will voluntarily delist the rights from The
New York Stock Exchange ("NYSE"). Safeway plans to file an
application on Form 25 to notify the SEC of the withdrawal of the
rights from listing on the NYSE, and expects the withdrawal to be
effective on July 3, 2014. Following the withdrawal, the
company will continue to file the same periodic reports and other
information it currently files with the SEC, but the rights will no
longer be listed or registered on an exchange or other quotation
medium.
Further details about the memorandum of understanding, and the
amendments to the definitive merger agreement and the stockholder
rights plan, will be contained in a Form 8-K to be filed by Safeway
with the SEC.
About Safeway Inc. Safeway Inc., which operates Safeway, Vons,
Pavilions, Randalls, Tom Thumb, and Carrs stores, is a Fortune 100
company and one of the largest food and drug retailers in the
United States with sales of $36.1 billion in 2013. The company
operates 1,332 stores in 20 states and the District of Columbia, 13
distribution centers and 19 manufacturing plants, and employs
approximately 138,000 employees. The company's common stock is
traded on the New York Stock Exchange under the symbol "SWY." For
more information, please visit www.Safeway.com.
Additional Information and Where to Find It This press release
does not constitute a solicitation of any vote or approval in
respect of the proposed merger transaction involving Safeway or
otherwise. In connection with the proposed merger, Safeway filed a
preliminary proxy statement with the SEC on April 17, 2014 and May
23, 2014, and intends to file relevant materials, including a
definitive proxy statement, with the SEC. Investors and
security holders of Safeway are urged to read the definitive proxy
statement and other relevant materials when they become available
because they will contain important information about the proposed
transaction. The proxy statement and other relevant materials
(when they become available), and any other documents filed by
Safeway with the SEC, may be obtained free of charge at the SEC's
website at www.sec.gov, at Safeway's website at www.Safeway.com or
by sending a written request to Safeway at 5918 Stoneridge Mall
Road, Pleasanton, California 94588, Attention: Investor
Relations.
Participants in the Solicitation Safeway and its directors,
executive officers and certain other members of management and
employees may be deemed to be participants in soliciting proxies
from the stockholders of Safeway in favor of the proposed merger.
Information regarding the persons who may, under the rules of the
SEC, be considered to be participants in the solicitation of
Safeway's stockholders in connection with the proposed transaction
and their ownership of Safeway's common stock will be set forth in
Safeway's proxy statement for its annual meeting. Investors
can find more information about Safeway's executive officers and
directors in its Annual Report on Form 10-K for the fiscal year
ended December 28, 2013, as amended.
Forward-Looking Statements This press release contains certain
forward-looking statements which are indicated by words such as
"expects," "will," "plans," "intends," "committed to," "estimates"
and "is." No assurance can be given that any of the events
anticipated by the forward-looking statements will transpire or
occur. Accordingly, actual results may differ materially and
adversely from those expressed in any forward-looking statements.
Neither Safeway nor any other person can assume responsibility for
the accuracy and completeness of forward-looking statements. There
are various important factors that could cause actual results to
differ materially from those in any such forward-looking
statements, many of which are beyond Safeway's control. These
factors include: failure to obtain stockholder approval of the
proposed merger; failure to obtain, delays in obtaining or adverse
conditions contained in any required regulatory or other approvals;
failure to consummate or delay in consummating the transaction for
other reasons; changes in laws or regulations; and changes in
general economic conditions. Safeway undertakes no obligation (and
expressly disclaims any such obligation) to publicly update or
revise any forward-looking statement, whether as a result of new
information, future events or otherwise. For additional information
please refer to Safeway's most recent Form 10-K, 10-Q and 8-K
reports filed with the SEC.
safeway (NYSE:SWY)
Historical Stock Chart
From Feb 2024 to Mar 2024
safeway (NYSE:SWY)
Historical Stock Chart
From Mar 2023 to Mar 2024