Kroger-Albertsons merger deal faces lawsuit from Washington state
A screen displays the company logo for Kroger Co on the floor of the New York Stock Exchange (NYSE) in New York City, U.S., October 14, 2022. REUTERS/Brendan McDermid Purchase Licensing Rights
Jan 16 (Reuters) - Washington state’s attorney general has sued to block Kroger’s proposed $25 billion acquisition of rival supermarket chain Albertsons as the U.S. Federal Trade Commission and other states continue to scrutinize the deal.
Attorney General Bob Ferguson in a statement on Monday said the proposed transaction, first announced in 2022, would limit “vital competition” between Washington state’s two largest supermarket chains and drive up consumer prices.
The antitrust lawsuit was filed in King County Superior Court and seeks an injunction against the deal.
“This merger is bad for Washington shoppers and workers,” Ferguson said. “Free enterprise is built on companies competing, and that competition benefits consumers.”
Kroger and Albertsons in a statement defended the proposed deal and said they were “disappointed in Attorney General Ferguson’s premature decision to file a lawsuit while the merger is still under regulatory review.”
The companies said they remain in "active and ongoing dialogue with the FTC and the other state Attorneys General.”
They said blocking the merger would let rival retailers such as Walmart, Costco and Amazon “maintain and increase their overwhelming and growing dominance of the grocery industry.”
A representative from Ferguson’s office did not immediately respond to a request for comment.
Kroger and Albertsons on Monday said they were pushing back their anticipated closure until later in the year.
Ferguson’s office in 2022 unsuccessfully sued to stop Albertsons from making a $4 billion payout to shareholders in advance of the grocer closing its deal with Kroger. The state alleged the payment would harm Albertsons’ ability to compete.
A U.S. judge in California last month dismissed a consumer lawsuit over the Kroger-Albertsons merger. The California attorney general’s office said in October it was weighing whether the deal violated competition law.
Kroger has proposed to divest more than 400 stores and eight distribution centers to C&S Wholesale Grocers to allay antitrust concerns over the Albertsons merger.
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