7 States Ask FTC to Block Kroger's $24.6 Billion Acquisition of Albertsons -- OPIS

Seven states on Wednesday asked the Federal Trade Commission to block Kroger Co.'s proposed $24.6 billion acquisition of Albertsons Cos., saying the combined company would control a quarter of a U.S. retail food market in which there is "already limited competition."

Both companies also are large fuel retailers.

The acquisition would affect almost 5,000 stores in Arizona, Colorado, Maine, Minnesota, New Mexico, Rhode Island and Vermont, the states said in a letter to FTC Chair Lina Khan.

"Kroger-Albertsons will have no competitive incentive to bring down prices," the states said, adding that during the "pandemic, Kroger chose to increase executive compensation and buy back stock to benefit shareholders, all while laying off workers and closing stores.

"The truth is these corporations are only responsible to shareholders, who stand to benefit from a $4 billion payout from a merger while grocery store workers who stock shelves are unable to pay for groceries themselves due to low wages."

The letter acknowledges that under the terms of the merger the companies will need to divest up to 400 stores, but "it is likely the corporations will target the lowest performing stores, often those in low-income communities. This will certainly exacerbate issues of food accessibility and affordability that already exist."

State officials also allege the merger will harm growers and shippers and put an "even larger strain" on families "struggling to pay bills."

"We are strongly opposed to this merger and urge you to stop this corporate consolidation that is draining Americans of their hard-earned wages and livelihoods," the letter said.

The two grocery chains have said they expect the deal to close next year following a regulatory review. It's uncertain how the merger and divestitures will affect the fuel operations.

This content was created by Oil Price Information Service, which is operated by Dow Jones & Co. OPIS is run independently from Dow Jones Newswires and The Wall Street Journal.

--Reporting by Donna Harris, [e-mail]; Editing by Jeff Barber, [e-mail]

(END) Dow Jones Newswires

August 16, 2023 15:06 ET (19:06 GMT)

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