The widely contested Kroger-Albertsons merger has officially been terminated two years after it was first announced. Now Albertsons Companies, Inc. (NYSE: ACI) (“Albertsons”) has filed an official lawsuit against Kroger Co. (NYSE: KR) (“Kroger”) accusing the grocer of sabotaging the sale after experiencing buyer’s remorse. That according to Supermarket News.
On December 10th, judges in Oregon and Washington halted the merger, siding with the Federal Trade Commission over concerns that the deal would limit grocery competition. A decision regarding a third antitrust case in Colorado is still pending in a lawsuit initially filed recently.
In the lawsuit Albertsons accused Kroger of failing to meet its commitment to use best efforts to secure approval for the merger. The agreement stipulated that both companies would take necessary actions to eliminate any regulatory barriers to closing the deal. Albertson’s claim that Kroger fell short in this regard, particularly when it came to creating a divesture plan.
The company alleged that Kroger neglected to consider potential buyers with proven experience in managing large grocery operations, instead opting for CNS Wholesale Grocers, which is primarily a wholesaler. The lawsuit asserts that presenting a robust divesture offer from the outset could have influenced FTC staff to be less likely to recommend blocking the merger and would have facilitated negotiations for a viable solution. However, Albertson’s claim that Kroger chose not to pursue that approach. In response, Kroger dismissed Albertsons allegations as unfounded.
I’m Lorrie Boyer reporting for AgNet West.