Albertsons Executives expressed skepticism in internal chats about promises of lower grocery prices and the legality of a proposed $25 billion merger with… Krogeraccording to An antitrust lawsuit was filed Monday by regulators in Washington state.
The lawsuit, which seeks to permanently halt the merger, came on the same day as Cincinnati-based Kroger Delay announced to complete the acquisition of the retailer in Boise, Idaho, citing ongoing discussions with state and federal antitrust regulators. While the two companies had hoped to close the deal early this year, the company issued a statement saying it expects to close the deal by August 17.
Washington Attorney General Bob Ferguson He criticized the merger proposal in his announcement of the legal proceedings, saying it would put workers' jobs at risk, reduce competition and lead to higher prices.
“This merger is bad for shoppers and workers in Washington,” Ferguson said. “Shoppers will have fewer choices and less competition, and without a competitive market, they will pay higher prices at the grocery store. This is not true, and this lawsuit seeks to stop this harmful merger.”
Ferguson cited internal chat communications by Albertsons executives in which they admitted they were “essentially creating a monopoly” that antitrust regulators in Washington discovered as part of their case. One executive even wrote: “It's all about pricing and competition, and we all know prices won't go down.”
Kroger's proposal, one of the largest retail mergers ever proposed, was controversial from the beginning. The deal impacts a combined network of nearly 5,000 stores in nearly every U.S. state and employment of more than 700,000 workers — that's more than United States Postal Service.
Consumer groups and unions opposed the dealClaiming that it will harm competition and ultimately lead to raising prices and harming workers. Federal regulators have declined to comment when they decide whether to ban it.
In response to the lawsuit, Kroger officials called it “premature,” saying the two companies “will vigorously defend this matter in court because we care deeply about our customers.”
Local chapter of United Food and Commercial Workers International Union He praised Ferguson's lawsuit:
“We have been clear and strong in our opposition to the proposed merger between Kroger and Albertsons from day one. Attorney General Ferguson has been a leader in this effort.” UFC W 3000 He said in a statement.
In a separate statement, Kroger updated the timeline for completing the merger:
“We remain in active and ongoing dialogue with Federal Trade Commission “Although this is longer than we originally thought, we knew it was a possibility,” Kroger said in a joint statement with Albertsons and C&S Wholesale Grocers, which agreed to buy hundreds of companies and state attorneys general in connection with the proposed merger and divestiture plan. Stores in a related divestiture transaction.
To allay concerns about competition and calm regulators, Kroger in September announced a $1.9 billion deal to sell 413 stores to Piggly Wiggly Operator and franchisor C&S Wholesale Grocery. The deal would allow Kroger and Albertsons to divest up to 650 stores if regulators want.
While the companies' statement maintained an upbeat tone, court documents in a civil lawsuit filed by consumers opposed to the deal revealed that federal regulators were far from signing off on the merger deal that Kroger had hoped to get the green light as early as December 15.
Kroger executives have previously vowed to fight the deal in court.
Editor's Note: Albertsons executives discussed merger concerns in internal chats. An earlier version misdescribed the technology used to talk to each other.
The Inquirer will update this story.
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