Albertsons prices upsized $1.5 billion senior notes offering

BOISE - Albertsons Companies, Inc. (NYSE:ACI), a $10.63 billion market cap retailer with annual revenues exceeding $81 billion, announced Monday the pricing of an upsized private offering of senior notes totaling $1.5 billion. The offering consists of $700 million in 5.500% senior notes due 2031 and $800 million in 5.750% senior notes due 2034. According to InvestingPro analysis, the company’s current debt structure and financial health score indicate careful management of its obligations.

The grocery retailer plans to use the proceeds, along with cash on hand, to redeem its $750 million in 3.250% senior notes due March 2026, repay a portion of borrowings under its asset-based revolving credit agreement, and cover related fees and expenses. With a current ratio of 0.81, this refinancing comes at a crucial time for managing short-term obligations.

Albertsons and its subsidiaries Safeway Inc., New Albertsons L.P., Albertson’s LLC, and Albertsons Safeway LLC will serve as co-issuers of the notes. The offering is expected to close around November 10, 2025, subject to customary closing conditions.

The notes were offered to qualified institutional buyers under Rule 144A of the Securities Act of 1933 and to non-U.S. persons outside the United States under Regulation S. The notes have not been registered under the Securities Act and cannot be offered or sold in the United States without registration or an applicable exemption.

Albertsons Companies operates 2,257 retail food and drug stores with 1,720 pharmacies and 405 associated fuel centers across 35 states and the District of Columbia. The company’s store banners include Albertsons, Safeway, Vons, Jewel-Osco, ACME, and Shaw’s, among others. Trading at an attractive P/E ratio of 11.5x and generating $3.65 billion in EBITDA, Albertsons maintains its position as a prominent player in the Consumer Staples sector. For detailed financial analysis and additional insights, including 7 more exclusive ProTips, visit InvestingPro for the comprehensive Pro Research Report.

This information is based on a press release statement from the company.

In other recent news, Albertsons Companies, Inc. announced plans to offer $1.25 billion in new senior notes due in 2031 and 2034. The proceeds from this offering will be used to redeem existing senior notes, repay part of its credit borrowings, and cover related expenses. Additionally, Albertsons reported second-quarter adjusted earnings per share of $0.44, surpassing expectations of $0.40. Adjusted identical store sales, excluding fuel, rose by 2.2%, slightly above the estimated 2.1%, despite challenges such as a labor strike in Colorado.

Tigress Financial Partners raised its price target for Albertsons to $29, highlighting the company’s robust digital growth and solid Q2 results. Meanwhile, RBC Capital maintained its Outperform rating, citing Albertsons’ improved fiscal year 2025 guidance and a $750 million accelerated share repurchase program. UBS lowered its price target to $25, acknowledging the company’s turnaround efforts and the ASR program’s role in supporting share prices. Lastly, BofA Securities adjusted its price target to $22, noting the impact of industry pressures but recognizing Albertsons’ earnings performance.

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