The Federal Trade Commission on Monday kicked off a trial amid its push to block Kroger's $25 billion merger with Albertsons by alleging the deal would undermine competition in the grocery store industry and hurt consumers. Kroger and Albertsons first announced the proposed merger in October 2022 and unveiled their divestiture plan in September 2023. The companies have agreed to sell nearly 600 locations to C&S Wholesale Grocers to help the deal pass regulatory muster.
Kroger attorney Matthew Wolf said in his opening statement that the merger would immediately lower some prices for shoppers at Albertsons, where prices are 10-12% higher than at Kroger stores. He said the FTC's effort to block the deal shows "they neither understand the industry nor the parties within it," and added that the merger would help the stores compete with rivals like Walmart – the largest grocery retailer in the U.S. – as well as Costco and Amazon-owned Whole Foods.
The FTC's suit represents a high-profile component of the Biden-Harris administration's efforts to lower prices for consumers, as well as FTC Chair Lina Khan's efforts to use antitrust law as a means of boosting wages and mobility for workers. U.S. District Judge Adrienne Nelson is presiding over the case in Portland, Oregon, and she is considering whether the deal should be paused while the FTC's in-house judge examines how the merger would impact competition.
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