Safeway Inc. Announces Declaration of a Special Stock Dividend to
Spin-Off Blackhawk Network Holdings, Inc.
PLEASANTON, CA--(Marketwired - Mar 24, 2014) - Safeway Inc.
(NYSE: SWY) announced today that its Board of Directors declared a
special stock dividend to its stockholders of all of the 37,838,709
shares of Class B common stock of Blackhawk Network Holdings, Inc.
owned by Safeway, representing approximately 94.2% of the total
outstanding shares of Blackhawk's Class B common stock and
approximately 72.0% of the total number of shares of Blackhawk
common stock of all classes outstanding. The date of
distribution by Safeway of the special stock dividend (the
"Distribution Date") is contemplated to be April 14,
2014. Blackhawk's Class A common stock presently trades on the
Nasdaq Global Select Market under the symbol "HAWK." Shares of
Blackhawk Class B common stock are not currently traded on any
stock exchange but, upon completion of the spin-off, are expected
to trade on the Nasdaq Global Select Market under the symbol
"HAWKB." Blackhawk's Class B common stock has 10 votes per
share, and Blackhawk's Class A common stock has one vote per
share.
The distribution by Safeway of the special stock dividend will
be made on the Distribution Date to all Safeway stockholders of
record on April 3, 2014 (the "Record Date"). The distribution will
take place in the form of a pro rata dividend of Blackhawk Class B
common stock to each Safeway stockholder of record on the Record
Date. As of March 21, 2014, Safeway had approximately 230.3 million
shares of its common stock outstanding. Accordingly, it is
anticipated that Safeway stockholders will receive approximately
0.164308 of a share of Blackhawk Class B common stock for every
share of Safeway common stock held as of the Record Date, less any
shares of Blackhawk Class B common stock withheld in respect of
applicable withholding taxes. The final distribution ratio for
the stock dividend will be calculated by dividing the number of
shares of Blackhawk Class B common stock to be distributed by the
number of shares of Safeway common stock outstanding on the Record
Date. No fractional shares of Blackhawk stock will be
distributed. Instead, Safeway stockholders will receive cash
in lieu of any fraction of a share of Blackhawk stock that they
otherwise would have received.
Information Regarding the Spin-off Transaction
No vote or action is required by Safeway's stockholders in order
to receive the special stock dividend of shares of Blackhawk Class
B common stock. Safeway stockholders of record on the Record
Date will receive account statements reflecting their ownership
interest in shares of Blackhawk Class B common stock. The Blackhawk
shares issued in the distribution will be in book-entry
form. Safeway stockholders who hold their shares through
brokers or other nominees will have their shares of Blackhawk stock
credited to their accounts by their nominees or brokers. For
additional information, registered stockholders in the United
States and Canada should contact Blackhawk's transfer agent, Wells
Fargo Shareowner Services, a division of Wells Fargo Bank, N.A., at
1-800-242-0813. Stockholders from outside the United States
may call 1-651-450-4064.
Safeway plans to send an information statement regarding this
transaction to its stockholders of record on the Record Date on or
about April 8, 2014. The information statement will include details
on the distribution, including, among other things, additional
information about the ratio used to compute the number of Blackhawk
shares distributed for each Safeway share, how fractional shares
will be treated, and the spin-off's expected tax consequences for
Safeway stockholders. This information statement will be
posted under the Investor Relations tab on Safeway's website at
www.safeway.com/investor_relations and on Blackhawk's website at
www.blackhawknetwork.com.
Trading in Shares of Stock Between Record Date and Distribution
Date
From the Record Date and up to and including the Distribution
Date, it is expected that there will be two markets in Safeway
common stock, a "regular way" market and a "when-issued"
market. Shares of Safeway common stock that trade in the
regular way market will carry an entitlement to the special stock
dividend of shares of Blackhawk Class B common
stock. Therefore, if you own shares of Safeway common stock
and sell those shares in the regular way market prior to or on the
Distribution Date, you also will be selling your right to receive
the special stock dividend of shares of Blackhawk Class B common
stock. The New York Stock Exchange is expected to authorize a
when-issued market for Safeway common stock on or about two
business days prior to the Record Date. Shares of Safeway
common stock that trade on the when-issued market under the symbol
"SWYWI" will trade without the right to receive shares of Blackhawk
stock in connection with the distribution. Starting on April
15, 2014 (the business day following the distribution of the Class
B shares of Blackhawk) the "regular way" market for Safeway will be
trading "ex" or without the entitlement of the Class B shares of
Blackhawk. In addition, the "when issued" market of Safeway
("SWYWI") will no longer be available.
It also is expected that a when-issued market for the shares of
Blackhawk Class B common stock to be distributed in the spin-off
will develop on or about two business days prior to the Record Date
on the Nasdaq Global Select Market under the symbol
"HAWKV." Shares of Blackhawk Class B common stock are not
currently traded on any stock exchange. Starting on April 15,
2014 (the business day following the distribution of the Class B
shares of Blackhawk) the Blackhawk Class B common stock is expected
to begin trading on the Nasdaq Global Select Market under the
symbol "HAWKB," and the "when issued" market of Blackhawk Class B
common stock ("HAWKV") will no longer be available.
If you sell your shares of Safeway common stock prior to or on
the Distribution Date, you also may be selling your right to
receive the special stock dividend of shares of Blackhawk
stock. You are encouraged to consult your financial advisor
regarding the specific implications of selling Safeway common stock
prior to or on the Distribution Date.
U.S. Federal Income Tax Consequences
As previously announced, Safeway and Albertsons have announced
an agreement under which AB Acquisition LLC will acquire Safeway
(the "Merger"). Assuming that the acquisition of Safeway by AB
Acquisition LLC is completed as contemplated by the Agreement and
Plan of Merger entered into by Safeway and AB Acquisition LLC on
March 6, 2014, it is expected that the stock dividend will
constitute a taxable distribution to Safeway and Safeway's
stockholders for U.S. federal income tax purposes. In anticipation
of the completion of the Merger, Safeway intends to treat the
special stock dividend as a taxable distribution to Safeway
stockholders for U.S. federal income tax purposes, including for
purposes of the U.S. federal tax withholding rules. Accordingly,
the amount of the special stock dividend otherwise payable to
certain Safeway stockholders, including non-U.S. stockholders, will
be reduced in connection with any applicable withholding taxes. The
U.S. federal income tax consequences of the special stock dividend
will be described in greater detail in the information statement to
be sent to stockholders on or about April 8, 2014.
This information will also be posted under the Investor
Relations tab on Safeway's website at
www.safeway.com/investor_relations and on Blackhawk's website at
www.blackhawknetwork.com.
Safeway stockholders are urged to contact their tax advisors
regarding this transaction and the related tax consequences,
including potential withholding tax consequences.
About Safeway Inc.
Safeway Inc., which operates Safeway, Vons, Pavilions, Randalls,
Tom Thumb, and Carrs stores, is a Fortune 100 company and one of
the largest food and drug retailers in the United States with sales
of $36.1 billion in 2013. The company operates 1,335 stores in 20
states and the District of Columbia, 13 distribution centers and 20
manufacturing plants, and employs approximately 138,000 employees.
The company's common stock is traded on the New York Stock Exchange
under the symbol SWY. For more information, please visit
www.Safeway.com.
Forward-Looking Statements
This press release contains certain forward-looking statements
about the proposed spin-off of Blackhawk by Safeway, including
about the effect thereof on the respective businesses and
operations of the companies. These statements are based on
management's assumptions and beliefs in light of the information
currently available to it. These statements are indicated by words
such as "expects," "will," "plans," "intends," "anticipates,"
"estimates" and "is." No assurance can be given that any of the
events anticipated by the forward-looking statements will transpire
or occur. Accordingly, actual results may differ materially and
adversely from those expressed in any forward-looking statements.
Neither Safeway nor any other person can assume responsibility for
the accuracy and completeness of forward-looking statements. There
are various important factors that could cause actual results to
differ materially from those in any such forward-looking
statements, many of which are beyond Safeway's control. Safeway
undertakes no obligation (and expressly disclaims any such
obligation) to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or
otherwise. For additional information please refer to Safeway's
most recent Form 10-K, 10-Q and 8-K reports filed with the SEC.
Additional Information About the Acquisition and Where to Find
it
This press release does not constitute a solicitation of any
vote or approval in respect of the proposed Merger transaction
involving Safeway and Albertsons. In connection with the Merger,
Safeway intends to file with the Securities and Exchange Commission
(the "SEC") and furnish to its stockholders a proxy statement and
other relevant documents. Stockholders are urged to read the
proxy statement and other relevant materials when they become
available because they will contain important information about
Safeway, Albertsons and the proposed transaction. The proxy
statement and other relevant materials (when they become
available), and any other documents we file with the SEC, may be
obtained free of charge at the SEC's website at
www.sec.gov, at Safeway's website at
www.Safeway.com or by sending a written request to
Safeway at 5918 Stoneridge Mall Road, Pleasanton, California 94588,
Attention: Investor Relations.
Participants in the Solicitation
Safeway and its directors, executive officers and certain other
members of management and employees may be deemed to be
participants in soliciting proxies from the stockholders of Safeway
in favor of the Merger. Information regarding the persons who may,
under the rules of the SEC, be considered to be participants in the
solicitation of Safeway's stockholders in connection with the
proposed transaction will be set forth in the proxy
statement. You can find more information about Safeway's
executive officers and directors in its Annual Report on Form 10-K
for the fiscal year ended December 28, 2013 and in its definitive
proxy statement filed with the SEC on Schedule 14A on April 1,
2013.
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