Digging Into Albertsons’ Lawsuit Against Kroger
Albertsons Cos.’ lawsuit against The Kroger Co., filed last week in the Delaware Court of Chancery amid the collapse of the proposed merger, has now been unsealed, offering a deeper look at how Albertsons believes that Kroger failed to exercise “best efforts” and to take “any and all actions” to obtain regulatory approval of the companies’ proposed merger deal.
The complaint details the specific ways in which Albertsons alleges that Kroger intentionally violated the merger agreement, among them offering an initial divestiture package that appeared to be deficient, ignoring feedback from state antitrust regulators that the proposed divestiture package was deficient, rejecting highly qualified divestiture buyers in favor of a divestiture buyer whose main business was wholesale distribution, and disregarding feedback from C&S Wholesale Grocers on its divestiture package.
The suit contends that this conduct was because Kroger “had second thoughts after a negative market reaction to the merger and falling post-pandemic profits, and it decided it would go through with the deal, if at all, only on terms far more advantageous to Kroger than those for which it had bargained.”
When contacted for comment on the unsealing of the complaint, a Kroger spokesperson reiterated the company’s earlier refutation of Albertsons’ claims, which Kroger asserted were “baseless and without merit.”
Last week, the proposed mega-merger imploded after federal and Washington state courts ruled to block the deal.
As of Sept. 7, 2024, Albertsons Cos. operated 2,267 retail food and drug stores with 1,726 pharmacies, 405 associated fuel centers, 22 dedicated distribution centers and 19 manufacturing facilities. The Boise, Idaho-based company operates stores across 34 states and the District of Columbia under more than 20 well-known banners. Albertsons is No. 9 on The PG 100, Progressive Grocer’s 2024 list of the top food and consumables retailers in North America.
Cincinnati-based Kroger serves more than 11 million customers daily through a digital shopping experience and retail food stores under a variety of banner names. The grocer employs 420,000 associates and is No. 4 on The PG 100.
