Royal Ahold puts US Foodservice up for sale
Dec 1, 2006 12:00 PM
Netherlands-based Royal Ahold intends to sell its US Foodservice unit to boost profits. The food company, which operates the Stop & Shop and Giant retail chains in the United States, plans to cut operating costs by US $638 million by the end of 2009.
Ahold plans to divest its remaining Tops operations in Pennsylvania and New York, as well as retail operations in Poland and Slovakia, and it will sell its 49 percent share of Portugal's Jeronimo Martins Retail.
According to Anders Moberg, Ahold's chief executive, these actions are aimed at reinvigorating the firm after a 2003 accounting scandal involving US Foodservice almost bankrupted the Dutch food giant.
Ahold plans to return US $2.55 billion to shareholders, and will use the money from its divestments to trim its debt by a similar amount.
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