Sobeys has announced that it has signed a consent agreement with the Canadian Competition Bureau, allowing it to proceed with the acquisition of substantially all of the assets of Canada Safeway.
“We are delighted to have received regulatory clearance from the Competition Bureau,” said Marc Poulin, President & CEO, Sobeys Inc. “Our focus now turns to closing the deal, which we expect to do in early November, and beginning to serve our customers in Western Canada as one company.”
As part of the consent agreement, Sobeys will divest 23 stores – 13 Canada Safeway stores and 10 Sobeys stores - across British Columbia, Alberta, Saskatchewan, and Manitoba, according to a press release.
This news follows reports that Sobeys has reached a deal to buy Safeway stores in Western Canada for $5.8 billion last June. As part of the takeover, Sobeys will sell and then lease back about 4.8 million square feet of store space now owned by Safeway Canada and valued at $1.8 billion, according to the New York Times.
Sobeys said that the merging of the two chains will allow the company to save $200 million annually within three years by integrating and modernizing the two chains’ distribution networks, ultimately reducing the cost of administration, procurement and marketing, and making efficient use of Sobeys’ IT infrastructure across the new network of stories, according to CBC News.
Stay tuned to DeliMarket TV as we continue our coverage on Sobeys acquisition of Safeway Canada.