After rising from bankruptcy last year, Great Atlantic & Pacific Tea Co., a grocery chain operator, stated that it intends to sell the company. The announcement was stated in an internal memo to employees. Analysts said that this is in connection with the recent industry-wide move towards a bigger consolidation in the supermarket business.
Private equity firms and other investors have started to zero in on the potential sale. A source close to the deal said that Kroger Co., the Netherlands' Ahold NV, Cerberus Capital Management LP, and other private equity firms are interested in the supermarket operator.
The memo, as reported by The Wall Street Journal, enumerated multiple options for the company to finance its growth, including refinancing and raising capital. However, the outcome would most likely be a sale of the company, sources said. An expert on the matter said that a sale to another supermarket operator or private equity firm could put the value on the company to at least US$1billion.
"This is about options to grow the business, not about being in distress. It's a desire of capital, not a need for capital," a company spokesman explained.
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