The federal government has urged a US District Court to temporarily halt the merger of Kroger and Albertsons, arguing it would benefit shareholders but not everyday shoppers. The Federal Trade Commission's lawyers, in closing remarks after a three-week hearing Tuesday, suggested the $24.6 billion deal would reduce competition and drive up food prices for consumers. Judge Adrienne Nelson stated she would work "expeditiously" on the preliminary injunction request.
Kroger and Albertsons countered, claiming that their merger would help them compete against larger rivals such as Walmart, Costco, and Amazon. Kroger attorney Matt Wolf emphasized the need to act to protect local grocery stores, arguing that the combined entity would focus on reducing prices from day one. However, FTC's chief trial counsel, Susan Musser, warned that the merger would eliminate local competition, causing the companies to prioritize shareholder profits over consumer benefits.
Kroger indicated plans to invest $1 billion in price reductions if the merger proceeds, but Musser expressed skepticism, noting these promises were not legally binding. Union leaders and state attorneys general from nine states joined the FTC, contending that the merger could depress wages, shutter stores, and create "food deserts." Shares in both companies dropped by 2% on Tuesday following the closing arguments. If the injunction is granted, FTC hearings on the merger will commence on October 1. (This story was generated by Newser's AI chatbot. Source: the AP)
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