The Federal Trade Commission is suing to block a proposed merger between grocery giants Kroger and Albertsons.
"In some regions, such as in Denver, the combined Kroger/Albertsons would be the only employer of union grocery labor. Union grocery workers ability to leverage the threat of a boycott or strike to negotiate better CBA terms would also be weakened," the FTC said in a Monday news release.
Kroger operates thousands of stores across 36 states under individual banners such as King Soopers. Albertsons also operates thousands of stores across 35 states under regional names including Safeway.
The FTC said the $24.6 billion deal would eliminate competition and lead to higher prices for millions of Americans.
"The loss of competition will also lead to lower quality products and services, while also narrowing consumers' choices for where to shop for groceries," the FTC said in its news release.
The FTC filed a lawsuit Monday in U.S. District Court in Oregon. It was joined in the suit by the attorneys general of eight states and the District of Columbia. Kroger and Albertsons, two of the nation’s largest grocers, agreed to merge in October 2022.
Colorado State Treasurer Dave Young released the following statement:
“The FTC’s action is a huge win for Colorado workers, their families, and our communities... The risks posed by this merger far outweighed the benefit to the shareholders of Kroger and Albertsons. When consolidation harms workers, lowers accessibility of food and medicine, and results in detrimental impacts to local and state economies, it’s clear the deal is good for c-suite executives and bad for everyone else.”
In August, Colorado state Treasurer Dave Young wrote to the FTC, asking the agency to review potential consequences of the merger and block it.
The Offices of the Attorneys General of Arizona, California, Illinois, Maryland, Nevada, New Mexico, Oregon, and Wyoming joined the suit. While Colorado isn't among those listed, state Attorney General Phil Weiser announced his own lawsuit earlier this month to block the supermarket chains from combining.
In response to Colorado's lawsuit, Kroger and Albertsons issued a joint statement.
“We are disappointed in Attorney General Weiser’s premature decision to file a lawsuit while the merger is still under regulatory review, and we remain in active dialogue with the FTC and the other state Attorneys General," the release said. "The merging parties will vigorously defend this in court because we care deeply about our customers and the communities we serve, and this merger will result in the best outcomes for Colorado consumers."
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Colorado attorney general announces lawsuit to block Kroger, Albertsons merger
Colorado follows Washington state which announced a similar lawsuit in January.
Kroger and Albertsons said a merger would help them better compete with Walmart, Amazon, Costco and other big rivals.
“This supermarket mega merger comes as American consumers have seen the cost of groceries rise steadily over the past few years. Kroger’s acquisition of Albertsons would lead to additional grocery price hikes for everyday goods, further exacerbating the financial strain consumers across the country face today,” Henry Liu, director of the FTC’s Bureau of Competition, said.
*The Associated Press contributed to this story.
