FTC Sues to Stop $24.6 Billion Kroger-Albertsons Deal

Ervin Cohen & Jessup LLP

Ervin Cohen & Jessup LLP

On February 26, 2024, the Federal Trade Commission (“FTC”) issued an administrative complaint and authorized a lawsuit in federal court to block Kroger Company’s proposed $24.6 billion acquisition of the Albertsons Companies, Inc. The acquisition would be the largest supermarket merger in United States history.

The complaint was made pursuant to the agency’s authority under the FTC Act, and alleges that the proposed acquisition is anticompetitive. Nine attorneys general joined the FTC in filing the complaint.

The FTC’s complaint alleges that the Kroger-Albertsons acquisition would raise grocery prices and diminish both chains’ incentives to compete to produce higher quality, to the detriment of consumers.

Additionally, the FTC alleges that the acquisition would harm workers and the United Food and Commercial Workers (“UFCW”) union. Most employees for both Kroger and Albertsons are members of UFCW. The FTC alleges that if the acquisition were to take place, the grocery chains would have increased leverage over workers and their unions, which could slow wage increases and worsen working conditions and benefits.

The FTC’s press release states that the FTC “issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. The issuance of the administrative complaint marks the beginning of a proceeding in which the allegations will be tried in a formal hearing before an administrative law judge.”

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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