Kroger Not for Sale: Dillon

CINCINNATI - Kroger Co. here denied Friday it has any interest in selling the business through a leveraged buyout to a private equity firm after a report in the Wall Street Journal cited unnamed sources as saying investment firms had been examining the company as a potential acquisition target. In a strongly worded letter to employees, David B. Dillon, chairman and chief executive officer, said, "Neither management nor our board of directors has any interest in pursuing a leveraged buyout transaction. Our focus is on the execution of our business strategy [and] to continue to grow Kroger as an independent public company and create value for our shareholders. Putting our customers first has generated substantial returns for our shareholders, and we expect to continue to grow as we face the challenges of this intensely competitive industry." Dillon said it is Kroger's policy not to comment on acquisition rumors. However, he said he was breaking that policy in light of the assertions in the WSJ report. Earlier in the day a source in the investment community told SN a sale of Kroger to a private equity group was a strong possibility before the end of the year. "It will happen," he told SN. - Elliot Zwiebach