Safeway plans IPO of Blackhawk gift-card business
ASSOCIATED PRESS September 5, 2012 10:54AM
PLEASANTON, Calif. — Dominick’s parent, Safeway Inc. said Wednesday that it plans to take its gift card business, Blackhawk Network Holdings Inc., public by the first half of 2013.
The supermarket chain said it plans to file a registration statement for the public offering of a minority stake in Blackhawk. The exact timing of the IPO depends on market conditions. The company gave no details on pricing.
Blackhawk is a subsidiary of Safeway and sells gift cards at grocery stores and other retailers.
Several analysts said they expect the offering will be well-received.
Janney Capital Markets analyst Mark Williams said Blackhawk is a quick-growing, standalone entity that could easily be sold or separated. He said a move to cash in on this value has been widely expected. However, he noted that Safeway’s grocery business continues to struggle with tough competition, weaker traffic in stores and increasing debt.
Shares of Safeway, based in Pleasanton, Calif., rose to 6 percent to $16.77 by midmorning on the news.