01—Abstract
Summary
Summary of the 8-K filed December 13, 2024. Cited figures are marked; the original filing is the authoritative source.
On December 11, 2024, The Kroger Co. delivered a notice to Albertsons Companies, Inc. terminating the previously announced Agreement and Plan of Merger dated October 13, 2022, among Kroger, Albertsons and Kettle Merger Sub, Inc. In connection with that termination, Kroger is required under the indenture governing its SMR Notes to redeem those notes.
The SMR Notes consist of $1,000,000,000a of 4.700% Senior Notes due 2026, $1,000,000,000 of 4.600% Senior Notes due 2027, $1,400,000,000 of 4.650% Senior Notes due 2029 and $1,300,000,000 of 4.900% Senior Notes due 2031. Kroger issued a notice of special mandatory redemption on December 12, 2024, and will redeem the SMR Notes on December 18, 2024 at 101% of principal amount, plus accrued and unpaid interest to, but excluding, the redemption date. The filing states that it does not itself constitute a notice of redemption.
The filing is made under Item 2.04, which covers triggering events that accelerate or increase a direct financial obligation. The filing's forward-looking statements caution that the termination of the merger agreement and the related divestiture plan may affect Kroger's sales, earnings, and adjusted free cash flow goals, alongside the other risks listed in the filing.
02—Key points
Key Highlights
- Kroger terminated the merger agreement with Albertsons Companies, Inc. by notice delivered December 11, 2024; the agreement was dated October 13, 2022.
- The termination triggers a required special mandatory redemption of the SMR Notes under the Indenture.
- The SMR Notes total $4.7 billion across four series: $1.0 billion due 2026, $1.0 billion due 2027, $1.4 billion due 2029 and $1.3 billion due 2031.
- Redemption price is 101% of principal amount, plus accrued and unpaid interest to, but excluding, the Redemption Date.
- The Redemption Date is December 18, 2024; the notice of special mandatory redemption was issued December 12, 2024.
- The filing states that the 8-K itself is not a notice of redemption for the SMR Notes.
- The forward-looking statements flag the merger termination and related divestiture plan as a factor that could affect Kroger's sales, earnings, and adjusted free cash flow goals.
03—Questions
Frequently Asked Questions
Why is Kroger redeeming the SMR Notes?
The filing states that, following the termination of the merger agreement with Albertsons, the Indenture under which the SMR Notes were issued requires Kroger to redeem them. The filing describes the redemption as a special mandatory redemption.
What price will holders receive when the notes are redeemed?
The SMR Notes will be redeemed at a redemption price equal to 101% of their principal amount, plus accrued and unpaid interest to, but excluding, December 18, 2024.
What are the principal amounts and maturities of the SMR Notes?
The SMR Notes consist of $1,000,000,000 of 4.700% Senior Notes due 2026, $1,000,000,000 of 4.600% Senior Notes due 2027, $1,400,000,000 of 4.650% Senior Notes due 2029 and $1,300,000,000 of 4.900% Senior Notes due 2031.
When and how was the merger agreement terminated?
Kroger delivered a notice to Albertsons on December 11, 2024 terminating the Agreement and Plan of Merger dated October 13, 2022, which provided for Albertsons to become a wholly owned subsidiary of Kroger through a merger with Kettle Merger Sub, Inc.
Does this 8-K serve as the formal notice of redemption?
No. The filing states that this Current Report on Form 8-K does not constitute a notice of redemption with respect to the SMR Notes. Kroger issued a separate notice of special mandatory redemption to holders on December 12, 2024.
04—Continue