The $40-per-share offer for Safeway (SWY +0.2%) from Cerberus is the lowest valuation on a major food industry merger in the last ten years, according to Bloomberg. The deal price indicates low interest amongst major players for the struggling brand.
The "go-shop" period of 21 days is expected to be quiet with Kroger (KR +0.5%) seemingly unwillingly to come in over the top with a bid for the whole company.
Analyst take: Cantor Fitzgerald says the complicated Cerberus deal includes some risk for Safeway shareholders that the sale of property development centers won't generate the estimated returns. If that's the case, shareholders will earn less than the $40 bid price.