MrK: I agree with you. I have owned SWY stock for many years and have received a decent return on my investment. No complaints here. I still shop at their stores. Time to take the money and move on to other investments. Best of luck to all.
As a stockholder, once I get my cash, the company future is unimportant to me. Not trying to be insensitive, only practical. No different then me not owning Apple stock and watching the huge run up over the last several years, I don't use their products and no longer own companies that do business with them so I don't care if they go to a $1000 per share or belly up!
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Good point. The loss on Safeway's bonds actually seems like a bit of an under-reaction, at these levels. Assuming you want to stay involved in the new entity, zmonator, comparable Albertsons bonds trade anywhere from 5 to 10 points lower ($50 - $100 per bond lower), and about 100 basis points more yield.. Example: Albertsons 7.45%s of 2029, a $650MM size deal, traded at $91.25, an 8.51% yield. Albertsons also has several other long issues: 7.75%, 8% an 8.70%. Good luck.
Look at the history of the share price, condition of stores and store prices and you may understand. Steve Burd ran it into the ground before increase due to merger and takeover talk after he left...
The merger and prior spinoff of Hawk yields over twice what Safeway shares were trading for just 2 years ago. So what is all the griping about?
Very well said. And the fact that the last three SWY CEO's and a few SVP's filled their pockets with lots of cash at shareholder and especially employees expense and pain... Bye all!
This may explain why Safeway's bonds were downgraded to CCC+ by S & P as I see that Albertson's are also rated CCC+ by both Moodys and S&P
So, the merger will close tomorrow or Friday. I am sure this message board will go away at that time.
It has been a pretty sad run for SWY. Going from a great grocery chain with well run stores in the late 90's to the poorest run national chain and with the worst service and pricing of almost any chain today. Add in how Safeway destroyed a number of unique regional chains in the process and the story is simply sad.
It is hard to imagine Albertsons is buying this chain, but it has strong private equity backing and is doing it mostly with debt, so we will see how that goes. As of late, Albertsons Stores are run much better than those of Safeway. I expect them to make some improvements to the very poor Safeway operations.
Time will tell how this shakes out.
All bonds were downgraded. S&P indicated in July 2014 they would downgrade once the merger closed.
July 29, 2014--Standard & Poor's Ratings Services
today said its ratings on the Pleasanton, Calif.-based Safeway Inc., including
the 'BBB' corporate credit rating, remain on CreditWatch with negative
implications, where we placed them on Feb. 20, 2014. This follows Albertson's
Holdings Inc.'s debt issuance to fund the purchase of Safeway Inc.
Ratings on Safeway Inc. are not affected by Holdings' debt issuance, but we
still expect to equalize the rating with that of Albertson's Holdings LLC
after the purchase gets regulatory approval, likely in late 2014. At that
point, we expect to lower the ratings on Safeway's outstanding notes
(including the 5.00% senior notes due 2019, its 3.95% notes due 2020, its
4.75% senior notes due 2021, 7.45% debentures due 2027, and 7.25% debentures
due 2031) to 'CCC+' with '6' recovery rating. We will rate these notes two
notches below the prospective corporate credit rating.
They were Investment grade BBB think Moodys is still Baa1 but the bonds are C junk now? bonds loss $40
per bond in hours
Anyone have any thoughts or know something I don't please share