Albertsons Companies Issues Statement Regarding the Temporary Restraint of its Special Dividend Payment as a Result of Washington State Court’s Temporary Restraining Order
04 November 2022 - 03:24AM
Business Wire
Albertsons Companies (NYSE: ACI) (“Albertsons Cos.” or “the
Company”) today announced that the Attorney General of the State of
Washington has been granted a temporary restraining order (“TRO”)
by a Commissioner assistant to the Judge. The TRO restrains the
Company from paying the previously announced $6.85 per common share
Special Dividend (the “Special Dividend”), originally scheduled to
be paid on November 7, 2022. The Order enables the Court to
consider the merits at a hearing scheduled for November 10, 2022.
The Order remains in effect until November 10, 2022, unless within
that time, an order is entered extending or dismissing the TRO.
Albertsons Cos. intends to seek to overturn the restraint as
quickly as possible because the temporary order was based on the
incorrect assertion that payment of the Special Dividend would
impair its ability to compete while its proposed merger (the
“Merger”) with The Kroger Co. (“Kroger”) is under antitrust review.
A hearing on the State of Washington’s request for a preliminary
injunction is scheduled for November 10, 2022.
Albertsons Cos. continues to maintain that the lawsuit brought
by the State of Washington, and the similar lawsuit brought by the
Attorneys General of California, Illinois, and the District of
Columbia are meritless and provide no legal basis for canceling or
postponing a dividend that has been duly and unanimously approved
by Albertsons Cos.’ fully informed Board of Directors. Albertsons
Cos. is a thriving business which has delivered over $75 billion in
revenues in the rolling four quarters ended September 10, 2022,
following strong performance of $71.9 billion in revenues in fiscal
2021. Albertsons Cos. is well-capitalized, with limited debt and
significant free cash flow and is in a strong position financially.
The size of the dividend reflects the Company’s strength, rather
than the illogical and damaging accusation that it is an attempt to
weaken the Company.
The Company’s plan to return capital to stockholders is part of
its long-stated capital-return strategy and does not change the
fact that Albertsons Cos. is in the strongest financial position it
has ever been. The Company remains fully committed to investing in
the associates, stores, and digital capabilities that have made its
recent growth and strong performance possible. Albertsons Cos. is
confident that it will continue to make strategic progress
following the payment of the Special Dividend, given its strong
cash flows and low debt profile. After payment of the Special
Dividend, Albertsons Cos. will have approximately $3.0 billion of
liquidity, including approximately $500 million in cash and
approximately $2.5 billion available under its already existing
asset-based lending facility, and expects to continue to generate
strong revenues and positive free cash flow, furthering increasing
liquidity.
Albertsons Cos. intends to argue vigorously based on the factual
record that there is simply no basis to continue restraining the
payment of the Special Dividend.
Forward-Looking
Statements
This press release includes “forward-looking statements” within
the meaning of the federal securities laws. The “forward-looking
statements” include our current expectations, assumptions,
estimates and projections about the Special Dividend and the
payment thereof. They include statements which the Company believes
to be reasonable at this time. You can identify forward-looking
statements by the use of words such as “outlook,” “may,” “should,”
“could,” “estimates,” “predicts,” “potential,” “continue,”
“anticipates,” “believes,” “plans,” “expects,” “future” and
“intends” and similar expressions which are intended to identify
forward-looking statements.
These statements are not guarantees of future performance and
are subject to numerous risks and uncertainties which are beyond
our control and difficult to predict and could cause actual results
to differ materially from the results expressed or implied by the
statements.
All forward-looking statements attributable to us or persons
acting on our behalf are expressly qualified in their entirety by
these cautionary statements and risk factors. Forward-looking
statements contained in this press release reflect our view only as
of the date of this press release. We undertake no obligation,
other than as required by law, to update or revise any
forward-looking statements, whether as a result of new information,
future events or otherwise.
In evaluating our forward-looking statements, you should
carefully consider the risks and uncertainties more fully described
in the “Risk Factors” section or other sections in our reports
filed with the SEC.
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