As a three-week hearing kicked off, Albertsons on Monday said that it might resort to store closures and layoffs if its proposed merger with Kroger is blocked. The historic $24.6 billion merger faces opposition from the Federal Trade Commission (FTC), which argues it could reduce competition and elevate grocery prices amid high inflation. FTC's chief trial counsel, Susan Musser, emphasized the merger would harm consumers by eliminating competitive pricing between the two chains; it is hoping to secure a preliminary injunction to stop the merger while its complaint is heard by an in-house administrative law judge.
Albertsons and Kroger countered the FTC's stance, arguing that current grocery market dynamics, including the rise of players like Walmart and Costco in the space, necessitate the merger for sustaining competition. Albertsons attorney Enu Mainigi the company's customers now spend 88 cents per dollar at rivals that have national scale; the only way to compete is to have Kroger's help, she said. They also plan to divest 579 overlapping stores to C&S Wholesale Grocers, which owns the Piggly Wiggly brand; the FTC questioned C&S's readiness and willingness to do so.
Labor unions oppose the merger, fearing store closures could lead to "food and pharmacy deserts." UFCW members protested, stressing community and worker welfare over corporate profits. Judge Adrienne Nelson will hear from about three dozen witnesses before making a decision; should she block the merger, the FTC's in-house hearings will commence Oct. 1. (This story was generated by Newser's AI chatbot. Source: the AP)
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