NEW YORK (AP) — Supermarket chain Safeway said Monday that it agreed to resolve a shareholder lawsuit over its pending sale to an investment group led by Cerberus Capital Management.
Safeway said it will terminate its "poison pill" shareholder rights plan on Thursday instead of letting the plan expire in September. Such plans are often used to deter unwanted takeovers. The company also adjusted terms of the deal related to its ownership of Casa Ley, a Mexican food and merchandise retailer.
Shares of Safeway Inc. gained 6 cents to $34.15 in afternoon trading. They have been steady over the past three months but are up 57 percent since a year ago.
In March Cerberus agreed to buy Safeway for $7.64 billion, or $32.50 per share, in cash. Pending other transactions the deal could top $9 billion, or about $40 per share. As part of the latter deal, Safeway said it would sell its 49 percent stake in the company, and if it failed to do so in four years, shareholders would get a cash distribution equal to the value of its holdings. On Monday, it shortened that period to three years.
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