June 27, 2006

Risk Factors: Contingent Financial Advisory Fees and Prior/Potential Future Relationships of Fairness Opinion Providers

It’s likely that the SEC Staff is issuing some comments suggesting – or insisting – on the inclusion of a risk factor regarding contingent financial advisory fees and prior/potential future relationships of fairness opinion providers.

For example, below is a risk factor from page 22 of the joint proxy/prospectus relating to the acquisition of Albertsons by a consortium led by Supervalu (Albertsons also received a fairness opinion from Houlihan Lokey whose fees were not contingent on the outcome of the transaction):

“Some of the financial advisors to Albertsons and Supervalu have had prior business relationships with one or more of the parties to the transactions and are entitled to contingent fees in connection with the transactions.

Albertsons’ fee arrangements with Goldman Sachs and Blackstone, and Supervalu’s fee arrangements with Lazard, are structured so that certain fees are paid only if certain transactions are completed. The aggregate transaction fee payable by Albertsons to each of Goldman Sachs and Blackstone, the principal portion of which will only be payable upon completion of the transactions contemplated by the merger agreement, is currently estimated to be approximately $24.1 million. Similarly, under the terms of Supervalu’s engagement letter with Lazard, $15.5 million of consideration will be payable to Lazard only at the effective time of the Supervalu merger.

In addition to these contingent fee arrangements, Goldman Sachs has previously provided investment banking services to each of the parties to the transactions and/or their affiliates from time to time. These past services include, among others, acting as a participant in revolving credit facilities of Albertsons and Supervalu and providing financial advisory services to CVS and certain of Cerberus’s affiliates in connection with past acquisitions. Similarly, in the past Lazard has provided investment banking services to Supervalu for which it has received customary fees.

In addition, all of the financial advisors may provide services to the parties to the transactions in the future. For a more detailed description of the fee arrangements and past relationships of the financial advisors, see “Opinion of Albertsons’ Financial Advisors—Opinion of Goldman Sachs” beginning on page 56, “Opinion of Albertsons’ Financial Advisors—Opinion of Blackstone” beginning on page 58, and “Opinion of Supervalu’s Financial Advisor” beginning on page 77.”