Kroger and Albertsons are preparing for a potential lawsuit from the Federal Trade Commission over their proposed $24.6-billion merger as soon as January 2024, reports the Los Angeles Times. Opposition to the transaction continues to build.
The FTC has until January 17 to decide whether to approve the merger as a result of a timing agreement set up between the agency and the retailers, according to a court filing. This has caused a new surge of lawmakers and Teamsters to urge the agency to veto the deal.
According to local news source KTAR News, six U.S. senators and congress members, including Elizabeth Warren and Bernie Sanders, penned a letter to the FTC, noting that the transaction will hurt consumers, suppliers, and workers.
“This divestiture plan will not ameliorate harms to consumers, workers, and the grocery industry as a whole if the merger is allowed,” they wrote in the letter to FTC Chair Lina Khan. “We urge you to oppose this proposed merger, regardless of the proposed divestiture.”
The LA Times said that the agency is working with state attorneys general to review the deal and could either sue to block the transaction or agree to a settlement proposed by the grocers.
One of the transaction terms, a divestiture of more than 400 of the two companies’ stores, is going to be a “difficult sell,” as the FTC is concerned whether selling stores will ameliorate other problems brought on by the merger, said Bill Koviak, former FTC chair.
“The FTC is doing their homework,” he said. “They’ll be prepared to be in the courtroom.”
Earlier this year, Kroger and Albertsons agreed to divest 413 stores to C&S Wholesale Grocers along with Quality Food Centers, Mariano’s, and Carrs brands, and eight distribution facilities. Full Story
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