Albertsons said mulling Sprouts buy

for comment. A representative for Albertsons declined to comment.

Grocery stores have been battered by food deflation over the past year, forcing them to compete more aggressively over prices. The battle has weighed on Kroger Co., the largest U.S. grocery chain. The company posted negative same-store sales, excluding fuel, for the first time in more than a decade in the fourth quarter.

Conventional grocers, including Albertsons, Kroger and Wal-Mart Stores, have expanded their organic food offerings in response to changing consumer tastes in recent years. That has pressured natural grocers, including Whole Foods Market, to cut prices to better compete with the mainstream retailers.

Sprouts could fetch about $26 a share in a deal, Jefferies Group analyst Christopher Mandeville wrote in a note to clients Monday, an 18 percent premium to its last closing price. A sale might attract multiple suitors and lead to a competitive bidding process that could push valua- tion higher, he wrote.

Sprouts shares closed down 20 cents, or 0.91 percent, to $21.82 on Monday.

In September, Amin Maredia, Sprouts’ chief executive officer, said deep price cuts driven by deflation were “not sustainable,” and that his stores had been “exposed a little bit” by lower prices at large conventional stores.

Cerberus first invested in Albertsons in 2006 and then bought another group of stores in 2013 from SuperValu. Albertsons agreed in 2014 to acquire Safeway in a deal valued at about $9.2 billion, which was completed the following year.

In 2015, Cerberus began to prepare for an initial public offering of Boise, Idaho-based Albertsons, which now operates more than 2,200 stores, but it delayed those plans amid unfavorable market conditions.

New York-based Cerberus, led by billionaire Steve Feinberg, manages more than $30 billion in private equity holdings, distressed debt, other credit assets and real estate.