In This Article:
Kroger Co. and Albertsons Cos., which together operate hundreds of supermarkets in Arizona, announced a delay in their proposed merger, citing concerns from regulators.
"We remain in active and ongoing dialogue with the Federal Trade Commission and individual state attorneys general regarding our proposed merger and divestiture plan," the companies said in a joint statement issued with C&S Wholesale Grocers, which plans to buy some stores in overlapping areas.
Kroger owns Fry’s Food Stores in Arizona, along with a handful of Smith's in the northwest corner of the state, and Albertsons also owns Safeway.
The companies said the anticipated closing would happen during the first half of Kroger's fiscal year, which ends Aug. 17. Previously, they anticipated the deal happening sometime in early 2024.
C&S plans to buy 24 Albertsons or Safeway stores in Arizona, roughly one-fifth of the locations that Albertsons Cos. owns here. Kroger and Albertsons each own about 130 stores in Arizona.
Pushing back the timetable for the Kroger-Albertsons merger
In their statement issued on Tuesday, the companies downplayed the delay.
"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 said.
Washington's attorney general filed a lawsuit Monday seeking to block the $24.6 billion merger. Other attorneys general also have raised objections, including Kris Mayes of Arizona.
In addition, Arizona Secretary of State Adrian Fontes, and counterparts in other states, have asked the FTC to block the deal.
The companies asserted that the merger would provide "the meaningful and measurable benefits that we promised when we originally announced the transaction," including lower prices and more choices for customers.
Kroger said it would invest $500 million to reduce prices from day one, along with another $1.3 billion to enhance customer experiences.
"The merger will mean more fresh, affordable food is available to more people in more communities," the statement said.
Promise of no layoffs or store closings
Kroger also said it committed to protecting well-paying union jobs, with no store closures or front-line associates laid off as a result of the merger.
The company also vowed to invest an incremental $1 billion to raise wages and comprehensive benefits for all associates after closing of the deal.
Kroger employed more than 20,000 people in Arizona and Albertsons employed around 14,500, according to last year's Republic 100 special report.