Safeway

Safeway Incorporated

announced this afternoon on February 19th, 2014 that it is considering a possible sale of the company. Safeway has stated this, which seems a bit odd, “Although the discussions are ongoing, the company has not reached an agreement on a transaction, and there can be no assurance that these discussions will lead to an agreement or a completed transaction.” In addition to this news, Safeway is going to dispense the rest of the 370.8 million shares that it possesses of Blackhawk Network Holdings, or approximately 72% of Blackhawk's outstanding shares to Safeway stockholders or investors. The company also owns 49% of Casa Ley S.A. de C.V., who is the fifth largest food and general merchandise retailer in all of Mexico, based on sales. Safeway also has plans to sell its stake in this company as well. It is very possible that Safeway is begging to sell its stake it these companies to eliminate any unnecessary risk to gain its target of an acquisition. Safeway reported fourth quarter revenue of $11.3 billion which was compared to an $11.2 billion for the fourth quarter of 2012. Operating and administrative expenses also increased 58 percent to 24 percent of sales in the fourth quarter. Safeway is currently trading up $1.39 or 4.02 percent to an aggregate total of $36.00 per share. Safeway has issued forward guidance which reflects hat its free cash flow will increase by about 10 percent and earnings and revenue will increase as well.