Delhaize - Ceases issuing debt through Delhaize America

Delhaize Group announced today that its subsidiary Delhaize America (the Issuer) has started a consent solicitation w.r.t. proposed amendments to:

- the indentures governing the Issuer’s $ 70,697,000 outstanding 8.05% notes due 2027 (CUSIP No. 344775AC5) and
- $ 271,406,000 outstanding 9.00% Debentures due 2031 (CUSIP Nos. 246688AF2 and 246688AB1).

The purpose of the proposed amendments is to amend certain provisions in the Delhaize America Indentures to align them with the corresponding provisions of the indentures under which Delhaize Group has issued its debt securities.

The company plans to issue any future long-term debt through Delhaize Group and to cease issuing long-term debt through Delhaize America, which has not issued long-term debt since 2001.
Delhaize America is offering a consent fee of $ 15 per $ 1,000 principal amount of the aforementioned securities to holders that validly provide their consent to the proposed amendments by 5:00 p.m., New York City time on August 20, 2013.

Conclusion:
No impact on our equity investment case. We reiterate our Buy recommendation and € 55 target price.