Kroger, Albertsons to Sell 166 More Grocery Stores to Appease FTC, Get Merger Approved

The Federal Trade Commission (FTC) is challenging Kroger’s acquisition of Albertsons and Kroger, and now the two stores have offered up another compromise to curb concerns about the merger’s approval.

Now, the two grocery store chains have agreed to sell an additional 166 stores to C&S Wholesale Grocers (which owns 24 Piggly Wiggly and Grand Union supermarkets) in a divestiture deal set to be worth an estimated $2.9 billion. The total number of stores sold to the retailer is now 579.

The additional grocery stores sold to C&S will ensure that no storefronts close, no employees lose their jobs, and no employee benefits change upon the merger’s completion, Kroger’s CEO Rodney McMullen said in a company release.

Related: FTC Sues to Block $25 Billion Grocery Merger Between Kroger, Albertsons

“Our proposed merger with Albertsons will bring lower prices and more choices to more customers and secure the long-term future of unionized grocery jobs,” he said.

The merger, which was announced in 2022 and worth an estimated $25 billion, is under scrutiny by the FTC. The agency claims that the new combined chain would limit competition and have disastrous implications for employees, customers, and food providers at large, from unfair prices to lower employee wages and beyond.

The FTC originally sued to block the merger in February and was joined by eight states and Washington, D.C.

“This supermarket mega-merger comes as American consumers have seen the cost of groceries rise steadily over the past few years. Kroger’s acquisition of Albertsons would lead to additional grocery price hikes for everyday goods, further exacerbating the financial strain consumers across the country face today,” said Henry Liu, director of the FTC’s Bureau of Competition, earlier this year. “Essential grocery store workers would also suffer under this deal, facing the threat of their wages dwindling, benefits diminishing, and their working conditions deteriorating.”

Related: Mark Cuban Shares His Hack for How to Get Cheaper Groceries

Additionally, Kroger has now agreed to sell the Haggen name to C&S, while C&S will operate the Albertsons name in California and Wyoming and the Safeway name in Arizona and Colorado.

The FTC has not yet commented on whether or not the revised divestiture deal would affect its decision to allow the merger to proceed.

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