Under scrutiny by the Federal Trade Commission (FTC) since its announcement in 2022, the proposed $25 billion merger between grocery giants Kroger and Albertsons is facing further revisions to address competition concerns. To curb the FTC’s apprehensions, the two companies have agreed to sell an additional 166 stores to C&S Wholesale Grocers. This brings the total number of stores divested to 579, a move that ensures no store closures, job losses, or alterations to employee benefits upon the merger’s completion. C&S, which operates 24 Piggly Wiggly and Grand Union supermarkets, will acquire the additional grocery stores, offering assurances that no storefronts will shutter. Kroger CEO Rodney McMullen emphasizes that this divestiture deal maintains employment and benefits for all affected employees. The FTC’s primary concern revolves around the potential anti-competitive effects of the merger, fearing limited competition, unfair pricing, and diminished employee wages. The agency initially filed a lawsuit in February to block the merger, joined by eight states and Washington, D.C. Henry Liu, Director of the FTC’s Bureau of Competition, expressed worries that consumers would face higher grocery prices and that essential grocery store workers would experience reduced wages, diminished benefits, and deteriorated working conditions. Kroger has also agreed to sell the Haggen name to C&S, while C&S will operate the Albertsons name in California and Wyoming and the Safeway name in Arizona and Colorado. The FTC has yet to comment on whether the revised divestiture deal will sway its decision regarding the merger’s approval.
Kroger and Albertsons Offer Revised Compromise to Address FTC Merger Concerns
