Cerberus Buys Safeway, Merges It With Albertsons For Over $9 Billion

 After a long courtship, private equity giant Cerberus Capital Management agreed to buy Safeway SWY -2.2% for over $9 billion on Thursday afternoon.

Safeway, the 2nd-largest grocer in the US, will merge with Albertson’s, the 5th-largest grocer, which Cerberus bought from SuperValu last year. The deal will give Safeway shareholders an estimated $40 per share, including $32.50 in cash.

safeway_small Cerberus Buys Safeway, Merges It With Albertsons For Over $9 Billion

The deal making may not be over soon, though. Kroger KR +0.95%, the country’s largest grocer (nearly twice as large as Safeway by revenue), is reportedly considering making its own offer for its competitor. The company previous outbid Cerberus for the Harris Teeter chain of supermarkets, paying $2.4 billion last summer.

“Safeway has been focused on better meeting shoppers’ diverse needs through local, relevant assortment, an improved price/value proposition and a great shopping experience that has driven improved sales trends,” Safeway CEO Robert Edwards said in a statement. ” We are excited about continuing this momentum as a combined organization.”