Federal judge halts $24.6B Kroger-Albertsons merger

Dec. 10 (UPI) -- U.S. District Court for Oregon Judge Adrienne Nelson on Tuesday ruled a proposed $24.6 billion merger between grocery chains Kroger and Albertsons likely would harm consumers and halted it.

The merger would have been the nation's largest for the grocery industry, but Nelson said Kroger and Albertsons officials would need to address federal regulators' antitrust concerns and get their approval before moving forward with a new merger plan.

Nelson agreed with arguments made by the Federal Trade Commission, which said the merger would stifle competition, cause higher grocery prices for consumers and make work conditions worse for Kroger and Albertsons workers, most of whom are unionized at both large grocery chains.

The FTC sought an injunction to block the proposed merger, which Nelson granted.

"Defendants may choose to abandon the merger because of the preliminary injunction," Nelson said. "This order in no way forces them to do so and leaves open the possibility that they may pursue the merger at a later date should it be deemed lawful in the administrative proceedings."

Nelson said the injunction only pauses the merger and any harm Kroger and Albertsons might experience would not overcome the "strong public interest in the enforcement of antitrust law."

Nelson's ruling "protects competition in the grocery market, which will prevent prices from rising even more," FTC spokesman Douglas Farrar said in a statement to media. "Strong, reality-based antitrust enforcement delivers real results for consumers, workers and small businesses."

Arizona Attorney General Kris Mayes is one of the case's plaintiffs and said the decision protects consumers and workers.

"Had this merger gone forward, it could have harmed families by reducing choices, driving up prices and eliminating jobs," Mayes said Tuesday in a news release. "This decision helps ensure that residents won't face the potentially devastating impacts of such a consolidation."

Officials for Kroger and Albertsons in 2022 announced the proposed merger between the two grocers to make them more competitive with Walmart, Amazon, Costco and other large retailers.

The merger would have made the new company the nation's third-largest retailer and second-largest grocery store chain with about 13.5% of the nation's $1.5 trillion grocery market compared to Walmart's 15.5% market share.