Albertsons: WA Supreme Court Clears Way For $4B Dividend

The Washington State Supreme Court has cleared the way for Albertsons to pay out a $4 billion shareholder dividend after it sided with a lower court trial judge in declining the state attorney general’s request to appeal an injunction on Tuesday.

The issue has been under review since November when Washington Attorney General Bob Ferguson filed a temporary restraining order (TRO) to block the payment; in the interim, a trial court judge in Seattle denied Ferguson’s request to place a preliminary injunction on the payment until the merger had undergone the full antitrust review process. In December, the Washington Supreme Court extended the TRO to further review the state AG’s complaints.

The order signed by Chief Justice Steven C. González stated that “the extension of the temporary restraining order (TRO) is hereby terminated,” clearing another hurdle for the supermarket chain to dole out the $6.85 per common share special dividend.

“Albertsons Cos. will immediately begin the process of paying the Special Dividend and amounts will be distributed as soon as practicable to stockholders of record,” the company announced in a statement Tuesday.

Albertsons has called the lawsuit “meritless” and said it would refuse to delay payment to shareholders.

AG Ferguson’s case proposed that the dividend would dilute Albertsons’ value and “risks severely undercutting the grocery giant’s ability to compete during the lengthy time period government regulators — including Washington — will be scrutinizing the merger.”

A similar effort to pause the payment by state AGs in California, Illinois and D.C. was also denied by a Washington D.C. circuit court panel.

In response to Tuesday’s news, AG Ferguson said in a statement that although he respects the decision, he is “disappointed the Supreme Court decided not to hear this case.”

He added, “That said, I want to be clear: This merger is far from a done deal. My team and I will be conducting a thorough review.”