Safeway Subject of LBO Speculation: Reports

SN STAFF

NEW YORK — Safeway is among companies attractive for a leveraged buyout, according to reports Tuesday citing trading activity and analyst reports.

Bank of America Merrill Lynch on Wednesday suggested that bondholders hedge against the risk of an LBO at Safeway by buying credit default swaps. Credit swaps rose at Safeway on Monday and Tuesday, indicating higher investor perception of a credit fault sparked by a debt-financed takeover.