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The Wall Street Journal reports that the Great Atlantic & Pacific Tea Co. (A&P) is circulating an internal memo in which company chairman Gregory Mays lays out a number of options for assuring its future, with one of them being the sale of the company ... a prospect that insiders tell the Journal is more likely than not.

Other options include raising capital and going through refinancing. But a sale of the company - possibly to chains that include Kroger (which just bought Harris Teeter, and does not have a presence in the Northeastern US) and Ahold (which could see some of A&P's locations as a way of backfilling and cementing its footprint there) - is seen as the most logical next step.

Another company mentioned in the piece as a possible suitor - Cerberus Capital Management, which led an investor group that acquired a number of banners, including Albertsons, from Supervalu earlier this year.

A&P emerged from bankruptcy protection in March 2012. The Journal story says that it could be valued by buyers at between $500 million and $1 billion.
KC's View:
I'd love to see Kroger buy A&P, because it would good to have that kind of high-level competition in the region.

But I'm just not sure it is a good fit, and whether Kroger could be effective in the spaces that A&P owns.

But I'm also not sure that A&P fits well into what Ahold does. It just seems like too big a stretch.

Perhaps the real problem is that A&P has become such a shapeless, nebulous entity that it is hard to see it being much of an acquisition, except for the real estate.