Do not expect the $24.6 billion Kroger, Albertsons merger to happen anytime soon.
The two grocers, along with C&S Wholesale Grocers, came out and said they expect the deal to become official during the first half of 2024 instead of early 2024, reports Reuters. Kroger and Albertsons said they will sell 413 stores to C&S as part of the merger deal.
This comes after a report from Axios last week indicated the Federal Trade Commission (FTC) would not be ready to decide on the merger until February.
“In light of our continuing dialogue with the regulators, we are updating our anticipated closure timeline,” the grocers said in a statement.
In December, Kroger and Albertsons informed the FTC they had met all the antitrust requirements for the merger, and it was then up to the agency to make a decision by Dec. 15.
The FTC, however, missed the deadline.
Kroger and Albertsons said they knew there was a possibility merger approval could be delayed, and both remain committed to closing the transaction and providing “meaningful and measurable benefits that we promised when we originally announced the transaction.”
Meanwhile, the Washington State attorney general has filed a lawsuit in a state court to block the merger.
“This merger is bad for Washington shoppers and workers,” Washington State Attorney General Bob Ferguson said in a statement Monday. “Shoppers will have fewer choices and less competition, and, without a competitive marketplace, they will pay higher prices at the grocery store.”
“If the merger is blocked, the non-union retailers like Walmart and Amazon will become even more powerful and unaccountable – and that’s bad for everyone,” Kroger said in an emailed statement to Supermarket News regarding the lawsuit. “Any decision to attempt to enjoin the transaction now would be premature as we are engaged in productive discussions with the FTC and state Attorneys General about how this merger will bring lower prices to more of America’s consumers who are still reeling from high grocery prices.”
Albertsons had a similar response.
Kroger also said Monday it will invest $500 million to reduce prices beginning day one of the merger and another $1.3 billion to enhance the customer experience.
“The merger will mean more fresh, affordable food is available to more people in more communities,” the Cincinnati-based grocer said.
Kroger also repeated its commitment to protecting union jobs and that it will invest $1 billion to raise wages and comprehensive benefits.
“Additionally, post-close Kroger will provide 700,000+ part-time and full-time associates access to its continuing education benefit, which offers up to $21,000 of reimbursement toward higher learning or continued development.”
Kroger said C&S Wholesale Grocers has also committed to recognize the union workforce and maintain all collective bargaining agreements and is committed to retaining frontline employees and further investing for growth.
“This is the best outcome to secure the future of union jobs in the American grocery industry,” Kroger said.
