Sector Update: Consumer

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Consumer stocks were little changed this afternoon, with shares of consumer staples companies in the S&P 500 rising less than 0.1%. Shares of consumer discretionary firms in the S&P 500 were down less than 0.1%.

In company news, Safeway ( SWY ) shares fell nearly 3% Friday after the grocery chain late Thursday announced a definitive merger agreement with Supervalu's ( SVU ) Albertson's unit in a deal valued at more than $9 billion.

The deal calls on SWY shareholders to receive $40.10 for each share they own, consisting of $32.50 per share in cash and pro-rata distributions worth an estimated $3.65 per share from the sale proceeds of a real-estate development subsidiary, a 49% interest in Mexican retailer Casa Ley SA de CV and other non-core assets.

The planned merger does not alter plans to distribute the remaining 37.8 million shares of Blackhawk Network ( HAWK ) to SWY shareholders with a current value of $3.95 per SWY share. The merger agreement also includes a "go-shop" period, during which SWY can actively solicit alternative proposals over the next 15 days and entering a deal within three weeks. The competing bidder would have to pay a $150 million termination fee to Albertson private equity owner Cerebrus, or $250 million if it strikes a deal beyond the 21-day go-shop period.

SWY shares were down 2.8% at $38.36 each in recent trade, narrowly inching above its $38.15 intra-day low. The stock had risen 12% since Feb. 18 when the company disclosed it was in buyout talks with an unnamed suitor. HAWK shares were up about 4.5% at $26.25 apiece.

In other sector news,

(+) SKUL, (+32.8%) Non-GAAP earnings decline 72% from a year earlier to $0.13 per share but still beats Capital IQ consensus by $0.04. Revenue slides 28% year over year to $72.2 mln, edging out Street estimates by $400,000. Forecasts at least 5% Q1 sales growth compared to analyst expectations for a 5% decline.

(-) GPS , (-0.2%) February sales decline 3.8% from year-ago levels to $929 mln. Same-store sales decline 7%; analysts were looking for a 1.1% gain.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , Commodities
Referenced Symbols: SWY , SVU , HAWK

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