TORONTO – Business – Sobeys Inc. today announced that binding purchase and sale agreements have been entered into with Overwaitea Food Group (“Overwaitea”) and Federated Co-operatives Limited on behalf of the Co-operative Retailing System (“Co-op”), that will see Sobeys sell 22 of the 23 stores it is required to divest as part of its October, 2013 Consent Agreement with the Competition Bureau related to its purchase of Canada Safeway. Additionally, Sobeys has signed a binding letter of intent with another retailer for the sale of its Price Chopper location in Winnipeg, which the company is also required to divest as part of its October Consent Agreement.
Through the negotiation of these transactions, Sobeys also agreed to include an additional seven stores in British Columbia in the package to be acquired by Overwaitea. This was done to create a divestiture package that meets the needs of both Sobeys and Overwaitea.
Total proceeds from the Overwaitea and Co-op transactions, including related real estate, will be approximately $430 million, subject to customary closing adjustments. Proceeds will be used to repay bank debt. The total annual sales from these stores are approximately $690 million and they generate EBITDA of approximately $59 million.
Both the Overwaitea and Co-op agreements have received approval from the Competition Bureau and Sobeys anticipates the deals will close in March or early April. The sale of the Price Chopper location remains subject to finalization of an asset purchase agreement with the purchaser and approval from the Competition Bureau.
| Overwaitea has agreed to purchase the following 15 store locations: | |
| Safeway | 2345 Beacon Avenue, Sidney, BC |
| Safeway | 1950 Foul Bay Road, Victoria, BC |
| Safeway | 3958 Shelbourne Street, Victoria, BC |
| Safeway | 1143 – 56 Street, Tsawwassen, BC |
| Safeway | 131 Signal Road, Fort McMurray, AB |
| Sobeys | 1000 Railway Avenue, Canmore, AB |
| Sobeys | 65 Bow Street, Cochrane, AB |
| Thrifty Foods | 270 East Columbia Street, New Westminster, BC |
| Safeway* | 3756 – 10 Avenue, Port Alberni, BC |
| Safeway* | 610 – 6th Street, New Westminster, BC |
| Safeway* | 181 Trans-Canada Highway, Duncan, BC |
| Safeway* | 108 – 3170 Tillicum Road, Victoria, BC |
| Safeway* | 370 Trans-Canada Highway, Ladysmith, BC |
| Thrifty Foods* | 18888 North Parallel Road, Abbotsford, BC |
| Thrifty Foods* | 2000 Island Highway, Nanaimo, BC |
| * Additional stores not included in October Consent Agreement | |
| Co-op has agreed to purchase the following 14 store locations: | |
| Safeway | 1441 Main Street, Winnipeg, MB |
| Safeway | 77 Vermillion Road, Winnipeg, MB |
| Safeway | 850 Dakota Street, Winnipeg, MB |
| Safeway | 1120 Grant Avenue, Winnipeg, MB |
| Safeway | 2331 – 66 Street NW, Edmonton, AB |
| Safeway | 3801 Albert Street, Regina, SK |
| Safeway | 3310 – 8 Street East, Saskatoon, SK |
| Safeway | 4926 – 46 Avenue, Taber, AB |
| Sobeys | 10004 – 99 Avenue, Fort Saskatchewan, AB |
| Sobeys | 5421 – 50 Street, Leduc, AB |
| Sobeys | 4703 – 50 Street, Wetaskiwin, AB |
| Sobeys | 18370 Lessard Road, Edmonton, AB |
| Sobeys | 5036 – 106 Avenue NW, Edmonton, AB |
| IGA | 6204 – 90 Avenue NW, Edmonton, AB |
