Kroger, Albertsons to sell 166 more stores with $25B merger in limbo

Kroger and Albertsons announced Monday that the companies are increasing the number of grocery stores they sell to C&S Wholesale Grocers to address federal regulators’ concerns about food impacts. Proposed $25 billion merger About competition.

166 more kroger & albertsons The store will be sold to C&S as part of the latest sale agreement between the three companies. The original sale plan included selling 413 stores, as well as eight distribution centers, two offices and five private label brands.

Under the new agreement, C&S will pay approximately $2.9 billion in cash for the stores, up from the $1.9 billion it paid under the original sale plan. The acquisition gives C&S access to 579 stores, as well as Albertsons Signature and O Organics private label brands.

“We are committed to upholding Kroger’s commitment to our customers, employees, and communities, addressing concerns raised by regulators, and ensuring that C&S can operate the divested stores as they currently operate. , we have reached an agreement with C&S on the latest sale package,” Kroger said. CEO Rodney McMullen said in a press release.

The Kroger-Albertsons merger: Good or bad for shoppers?

“Importantly, the updated divestment plan ensures that no stores will close as a result of the merger, that all front-line employees continue to be employed, that all existing collective agreements continue, and that employees remain in the industry. They continue to be guaranteed that they will continue to receive leading healthcare and pension benefits alongside their negotiated wages,” McMullen added.

C&S Wholesale Grocery Store CEO Eric Wynn said the company is “with this expanded sale package providing the stores, support assets, and professional operators needed to ensure these stores continue to successfully serve their communities for generations to come.” I am confident that we can provide that.”

Wynn added that C&S is “looking forward to welcoming the historic banner, high-quality private label brand, and team of experienced retail staff to the C&S family.” This amended agreement will ensure C&S’ legacy of selection, value and customer service continues our proud tradition of happy customers. . ”

Kroger and Albertsons merger in jeopardy

Albertsons and Kroger plan to sell stores and other assets to C&S Wholesale Grocers as part of the merger. (Joe Radle/Getty Images/Getty Images)

Kroger first announced plans to acquire Albertsons in October 2022, with the first sale package announced in September 2023.

of Federal Trade Commission (FTC) And in February 2024, eight states sued to block the proposed merger, arguing that it would hurt competition in the grocery store market by raising prices for consumers, closing stores, and eliminating jobs. woke up.

Some Democrats in Congress ask the FTC to block the Albertsons-Kroger merger

FTC Chair Lina Khan and her agency have filed a lawsuit seeking to block the Albertsons-Kroger merger. (Al Drago/Bloomberg via Getty Images/Getty Images)

a district court Oregon is scheduled to hold a hearing in August on the FTC’s request for a preliminary injunction to block the deal.

Tom Geiger, spokesperson for UFCW 3000, which represents Kroger and Albertsons. Employees who are members of a labor union The Washington, Oregon and Idaho chapters said their members were concerned that C&S could resort to selling store real estate if it lacked the necessary IT infrastructure, customer loyalty and manufacturing capabilities.

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According to a Reuters report, legal advisers close to the deal and sale plan say Kroger and Albertsons could effectively operate by increasing distribution capacity and increasing the density of regional store networks to support the business. He said he is trying to provide business.

Reuters contributed to this report.