DBRS confirms Safeway notes

DBRS said it confirmed the senior unsecured debt rating of Safeway Inc. and the second series notes rating of Canada Safeway Ltd. at BBB and downgraded the company's commercial paper rating to R-2 (middle) from R-2 (high).

The trends are stable.

According to the agency, these rating actions follow Safeway's announcement that it has increased the authorized level of its stock repurchase program, which had $900 million remaining at the end of Q3 2011, by $1 billion. It is also issuing $800 million of senior unsecured notes and plans to incur $700 million of bank term debt in the first half of 2012.

At the same time, DBRS said it has assigned a rating of BBB to the company's new issue of $800 million of senior unsecured notes, including the$400 million of 3.4% five-year notes and $400 million 4.75% 10-year notes.

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