Reuters reports that the Washington State Supreme Court "will review on Feb. 9 the state attorney general's appeal to permanently stop the company's blocked $4 billion special dividend ahead of its acquisition by Kroger Co."
Albertsons responded to the scheduling that it "continues to maintain that the claim brought by the Attorney General of the State of Washington, and the similar lawsuit brought by the Attorneys General of California, Illinois, and the District of Columbia, are meritless and provide no legal basis for preventing the payment of the Special Dividend. Albertsons’ position has been supported by favorable rulings in both Circuit and District courts in the District of Columbia and a Washington State court."
The dividend was announced at the same time as Kroger, the country's second largest food retailer, said that it wanted to acquire fourth-ranked Albertsons for $24.6 billion, a move that would leave the newly combined company still at number two behind Walmart, but with some 5,000 stores around the US. The deal is subject to regulatory approval by the Federal Trade Commission (FTC), with the divestiture of a number of stores in select markets expected. However, the proposed deal has been roundly criticized by some lawmakers, labor groups and consumer advocates as being bad for competition and likely to result in higher prices for shoppers.
- KC's View:
I know all the shareholders were hoping for a Christmas present from Albertsons, but this isn't as bad as getting a lump of coal - it is just a delay. At least for the moment.