A&P REACHES AGREEMENT UNLOCKING THE VALUE OF ITS CANADIAN OPERATIONS
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EXPECTS TO REALIZE PROCEEDS OF $1.475 BILLION INCLUDING SIGNIFICANT EQUITY STAKE
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GAINS OWNERSHIP INTEREST IN METRO INC., LEADING GROCERY RETAILER IN CANADA

Canada sales in the first quarter of fiscal 2005 ended June 18, 2005 were $1.2 billion vs. $1.1 billion last year. EBITDA for the quarter was $53 million vs. $36 million last year. EBITDA for the twelve months ended June 18, 2005, excluding certain IT costs and $35 MM in costs associated with the litigation settlement, totaled $164 million. The Company will be announcing its consolidated results for the first quarter on Friday, July 22, 2005.

Christian Haub, Chairman of the Board and Chief Executive Officer of A&P, said, "We are excited to enter into this historic agreement with METRO INC., which delivers the best possible outcome of our strategy to unlock the value of A&P Canada as announced on May 10. We also look forward to participation in METRO's future with a significant investment position and ongoing relationship with its management.

"The substantial cash proceeds from this transaction will fulfill all of our financial objectives by strengthening and de-leveraging our balance sheet, improving liquidity, and ensuring more than sufficient capital to execute our fresh and discount retail formats in the U.S. and seize other growth opportunities as they materialize. All told, this represents a major step toward our goal of achieving sustainable profitability by fiscal 2007.

"We also gain a significant investment position in METRO, whose outstanding performance track record has been among the best in all of North American food retailing over the past 10 years. With its highly regarded management team and retail operations, METRO's potential is further enhanced by the addition of our successful operations - creating one of the strongest food retailers in Canada offering attractive long-range growth. We also believe that our relationship will promote best practice exchange that will benefit the operations of both companies over time."

This investment position includes 18.077 million Class A Subordinate Shares based on a C$27.66 share price and represents a 15.83% ownership in METRO INC. The Company will also have 2 representatives on the board of directors of METRO INC.

Mr. Haub continued, "This is an excellent outcome for our Canadian associates, whose effort and dedication instilled in A&P Canada the tremendous value that METRO has recognized, and that we chose to realize at this time. With its similar management philosophies, retail strategies and organization values, I know METRO will be an outstanding employer that will offer rewarding career opportunities.

He concluded, "This is a very significant day for all A&P stakeholders. We will now move forward with a very strong balance sheet, enabling us to fully execute our strategic initiatives, with exciting store formats for the future, and a major investment position in one of the most dynamic retail entities in North America."

The Company said that J.P. Morgan Securities Inc. served as lead financial advisor and Lehman Brothers served as co-advisor for the transaction.

Founded in 1859, A&P, one of the nation's first supermarket chains, is today among North America's largest. The Company operates 637 stores in 10 states, the District of Columbia and Ontario, Canada under the following trade names: A&P, Waldbaum's, The Food Emporium, Super Foodmart, Super Fresh, Farmer Jack, Sav-A-Center, Dominion, The Barn Markets, Food Basics and Ultra Food & Drug.

The Company invites investors and other interested parties to listen to a live audio Webcast to be held at 11:00 AM Eastern Time today, at which members of the Company's senior management team will discuss this announcement in further detail. The Webcast may be accessed through a link on the "Investors" page of the Company's Website, www.aptea.com. Listeners who cannot participate in the live broadcast will be able to hear a recorded replay of the broadcast beginning this afternoon and available until August 16, 2005.

Effective March 28, 2003, the Securities and Exchange Commission ("SEC") adopted new rules related to disclosure of certain financial measures not calculated in accordance with Generally Accepted Accounting Principles ("GAAP"). Such new rules require all public companies to provide certain disclosures in press release and SEC filings related to non-GAAP financial measures. We use the non-GAAP measure "EBITDA" to evaluate the Company's liquidity and it is among the primary measures used by management for planning and forecasting of future periods. EBITDA is defined as earnings before interest, taxes, depreciation, amortization, minority interest, discontinued operations and cumulative effect of change in accounting principle. The EBITDA stated in this release excludes certain IT related costs allocated by the Company to its subsidiary and items the Company believes are non-operating in nature. The Company believes the presentation of this measure is relevant and useful for investors because it allows investors to view results in a manner similar to the method used by the Company's management and makes it easier to compare the Company's results with other companies that have different financing and capital structures or tax rates. In addition, this measure is also among the primary measures used externally by the Company's investors, analysts and peers in its industry for purposes of valuation and comparing the results of the Company to other companies in its industry.

This release contains forward-looking statements about the future performance of the Company, which are based on Management's assumptions and beliefs in light of the information currently available to it. The Company assumes no obligation to update the information contained herein. These forward-looking statements are subject to uncertainties and other factors that could cause actual results to differ materially from such statements including, but not limited to: competitive practices and pricing in the food industry generally and particularly in the Company's principal markets; the Company's relationships with its employees and the terms of future collective bargaining agreements; the costs and other effects of legal and administrative cases and proceedings; the nature and extent of continued consolidation in the food industry; changes in the financial markets which may affect the Company's cost of capital and the ability of the Company to access capital; supply or quality control problems with the Company's vendors; and changes in economic conditions which affect the buying patterns of the Company's customers.

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Investor Contact:
William J. Moss
Vice President, Treasurer
(201) 571-4019

Media Contact:
Richard P. De Santa
Vice President, Corporate Affairs
(201) 571-4495