Let the fight for Whole Foods (WFM) begin.

Shares of the organic grocer popped by 1.6% on Monday afternoon, following a report from the Financial Times noting that U.S. supermarket operator Albertsons is exploring a takeover of the grocery giant.

Albertsons is backed by a U.S. private-equity group Cerberus, which is said to have already had preliminary talks with bankers about making an offer for Whole Foods. About three years ago Albertsons acquired Safeway (SWY) for $9 billion, and turned it into the third largest supermarket chain in terms of revenue.

Albertsons should be prepared to pay through their nose to land Whole Foods.

Credit Suisse analyst Edward Kelly recently estimated that Whole Foods could fetch $40 to $45 per share, or an equity value of $12.7 billion to $14.3 billion. That potential purchase price would represent a steep trailing 12-month Ebitda multiple of 10 to 11 times, compared to a long-term average multiple of 8.1 times and an average multiple of 6.4 times since 2000 for Whole Foods.

Trending retail news on TheStreet:

Editor's Pick: Originally published April 24.

More from Stocks

What is a Stop-Limit Order and When Should You Use It?

What is a Stop-Limit Order and When Should You Use It?

Starbucks Shares Gain as Investor Day Highlights China Growth Ambitions

Starbucks Shares Gain as Investor Day Highlights China Growth Ambitions

Real Money Video Wrap: GE Jumps as Analysts Look to Price in Bottom

Real Money Video Wrap: GE Jumps as Analysts Look to Price in Bottom

Adobe Tops Q4 Sales Forecasts, Sees $11.1 Billion in 2019 Revenues

Adobe Tops Q4 Sales Forecasts, Sees $11.1 Billion in 2019 Revenues

Stocks End Indecisively, General Electric Rises, Key Trends You Need to Watch

Stocks End Indecisively, General Electric Rises, Key Trends You Need to Watch