Kroger Postpones Merger Deal with Albertsons

The supermarket giant Kroger has announced that it has postponed the merger with Albertsons and the comprehensive divestiture to C&S Wholesale Grocers initially planned for early 2024. The new timetable has been set for the first half of fiscal 2024, which ends on August 12th.

In a press release, the two grocery chains and C&S said, “We continue to have an active and ongoing dialogue with the Federal Trade Commission and the attorneys general of the various states regarding our proposed merger and asset sale plan.”

Amid growing opposition from members of Congress, independent grocers’ associations, and a lawsuit from the Washington state Attorney General, the Federal Trade Commission (FTC) plans to announce whether or not the merger is valid under the antitrust laws. 

Due to ongoing discussions with the FTC, the retailers postponed the negotiations’ closing.

“We currently anticipate that the closing will occur in the first half of Kroger’s fiscal 2024. While this is longer than we originally thought, we knew it was a possibility, and our merger agreement and divestiture plan accounted for such potential timing,” they reported in the statement. 

Related Article: Washington State AG Sued to Block Kroger-Albertsons Merger

Nevertheless, the grocery retailers said they remained committed to closing the transaction and delivering the significant and measurable benefits they promised when they originally announced the merger.

While the Washington state attorney general states in its lawsuit that the merger of the two grocery chains will lead to increases in grocery prices, job losses, and loss of access to grocery stores, Kroger and Albertsons claim that their merger will mean lower prices and more choices for more customers.

Kroger said it will invest $500 million to reduce prices from day one and an additional $1.3 billion to improve the customer experience. The merger will bring fresh, affordable food to more people in more communities.

Kroger is committed to protecting good-paying union jobs, with no store closings or layoffs of frontline employees due to the merger. In addition, Kroger will invest an additional $1 billion to increase wages and benefits for all employees post-closing.

In addition, post-closing, Kroger will provide more than 700,000 part-time and full-time associates with access to its continuing education benefit, which offers up to $21,000 in reimbursement toward higher learning or continued development.

The combined company will also expand access to its Goldman Sachs Ayco financial advisory tool.

As the identified divestiture buyer, C&S Wholesale Grocers has also committed to recognizing the union workforce, maintaining all collective bargaining agreements, retaining frontline employees, and further investing for growth.