The acquisition is worth about $7.64 billion in cash, and pending other transactions could top more than $9 billion.
It comes amid ongoing consolidation in the supermarket industry, which is facing growing competition from big-box retailers, specialty chains, drug stores and even dollar stores.
Bellevue-based grocery consultant Bert Hambleton says a shopping beheamonth should not fear customers with price gouging.
"I don't know that you're going to see them have the ability to actually raise prices in any way even though they'll be bigger and have more concentration," Hambleton said.
The Federal Trade Commission will examine the deal and Hambleton believes they will follow suit as they have in the past with deals of this size and require the merged companies to divest certain locations. That would mean possible sales to rival chains like PCC or Metropolitan Market.
"They're going to look at it and be very concerned about the competitive nature of retail grocery," Hambleton said.
Cerberus bought five chains including Albertson's and Jewel-Osco from Supervalu Inc. last year. Kroger Co. also recently snapped up regional chain Harris Teeter.
Safeway shareholders will receive $32.50 per share in cash. Pending other deals, the company says the deal is worth roughly $40 per share to stockholders.
Shares of Pleasanton, Calif.-based Safeway Inc. closed at $39.47 Thursday.