Market Overview

Safeway Go-Shop Period Ends, Downgraded to Hold by Deutsche Bank

Share:
Related SWY
Walmart To Partner With Quest Diagnostics To Offer In-Store Lab Work
Bernstein Explains Amazon's 'Prime Now' Service
Related KR
Factors To Consider Before Whole Foods' Q3 Earnings
Why Have Food Stocks Been Toast? Amazon, What Else?
Benson Investment Management Company, Inc. ... (GuruFocus)

On Monday, Deutsche Bank downgraded shares of Safeway (NYSE: SWY) from Buy to Hold and maintained a $40 price target.

Analyst Karen Short noted that Safeway is now subject to a “No Shop” provision, which “limits their ability to solicit alternative acquisition proposals.”

The analyst is not surprised no alternate bid has emerged. Should another bidder emerge, “the break up fee would be $250m,” said the Deutsche Bank analyst.

Three weeks may not have been enough time for Kroger (NYSE: KR) to make a “risk free” offer to counter the Cerberus bid. Kroger would have needed to provide “detailed market by market concentration analysis,” which was “simply not possible in a 21-day period,” said Short.

Shares of Safeway finished 0.97 percent lower to $36.94 in Monday's trading.

Latest Ratings for SWY

DateFirmActionFromTo
Apr 2014Cantor FitzgeraldMaintainsHold
Apr 2014Deutsche BankMaintainsHold
Apr 2014JefferiesMaintainsHold

View More Analyst Ratings for SWY
View the Latest Analyst Ratings

Posted-In: Deustche Bank Karen ShortAnalyst Color Downgrades Analyst Ratings

 

Related Articles (KR + SWY)

View Comments and Join the Discussion!