Seven states have called on the Federal Trade Commission (FTC) to prevent Kroger Co. from acquiring Albertsons Cos., citing concerns that the combined company would have a dominant position in the U.S. retail food market, which already suffers from limited competition.
In a letter addressed to FTC Chair Lina Khan, the states—Arizona, Colorado, Maine, Minnesota, New Mexico, Rhode Island, and Vermont—highlighted that the deal would impact nearly 5,000 stores in their regions. They expressed worries that the merger would eliminate competitive pressure on prices.
The states also criticized Kroger’s actions during the pandemic, claiming that the company chose to prioritize shareholder benefits instead of supporting its workforce. They accused Kroger of increasing executive compensation and buying back stock while laying off workers and shutting down stores.
According to the letter, 400 stores will be divested as part of the merger agreement. However, state officials argued that it is likely that these divestitures will primarily target underperforming stores in low-income communities, further exacerbating existing issues of food accessibility and affordability.
Besides the potential harm to consumers, state officials emphasized the negative impact of the merger on growers, shippers, and families already struggling financially. They urged the FTC to intervene and put a stop to this consolidation that allegedly undermines workers’ well-being and livelihoods.
Kroger and Albertsons have announced their expectation for the deal’s closure by next year pending regulatory approval. The effect of the merger on their fuel operations remains uncertain.