The number reported is $653 million - what the Great Atlantic & Pacific Tea Company Inc. is willing to pay in cash and stock to acquire Pathmark.
A deal has yet to be announced but the acknowledgment of negotiations came as no surprise as Pathmark has been on the block for some time.
"It's no secret that it would be a significantly value-creating event for A&P if they could acquire and did acquire Pathmark," said Karen Short, an analyst with Friedman Billings Ramsey & Co.
Ms. Short also called it "very rare that you find a combination where the synergies are as great as they are in this particular scenario."
The possible sale of Pathmark comes on the heels of an announcement that Whole Foods would purchase Wild Oats. Yucaipa Cos. led by Ron Burkle held a significant stake in Wild Oats as it does in Pathmark.
Discussion Question: What is your reaction to a deal whereby A&P would acquire Pathmark?