Biden admin asks to block massive grocery merger in latest antitrust crackdown

The Biden administration announced Monday that it is filing a lawsuit to block the proposed merger of grocers Kroger Company and Albertsons Companies, Inc., claiming the deal is anti-competitive.

The Federal Trade Commission (FTC) sued to stop the $24.6 billion acquisition, claiming there is fierce competition between Kroger and Albertsons that would disappear in a merger, lowering product quality while raising prices. . seconds to an FTC press release. The Biden administration, through both the FTC and the Department of Justice, has chased multiple lawsuits to block massive mergers during the president's tenure and has also tried to break up what they say are monopolies like Google and Amazon.

“This mega supermarket merger comes as American consumers have seen the cost of groceries rise steadily over the past few years,” Henry Liu, director of the FTC's Office of Competition, said in the statement. “Kroger's acquisition of Albertsons would lead to additional grocery price increases for everyday goods, further exacerbating the financial strain facing consumers across the country today. Essential store workers of groceries would also suffer with this agreement, faced with the threat of a decrease in their wages, a decrease in benefits and the deterioration of their working conditions”.

First the two grocery stores considered negotiating a merger in October 2022, with the acquisition expected to make them a “supermarket titan”. The proposed deal would top the previous largest U.S. supermarket deal in 2006, when a group of investment firms including Supervalu and CVS Health Corp. bought Albertsons for about $9.8 billion.

FTC challenges Kroger's acquisition of Albertsons. The largest supermarket merger in US history will eliminate competition and raise grocery prices for millions of Americans, while harming tens of thousands of workers, according to the FTC: https://t.co/sEYAemY2ix /1

— FTC (@FTC) February 26, 2024

“The FTC's decision makes it more likely that American consumers will see higher food prices and fewer grocery stores at a time when communities across the country are already facing high inflation and food deserts ” a Kroger spokesperson told the Daily Caller News Foundation. “In fact, this decision only strengthens the largest, non-union retailers like Walmart, Costco and Amazon, allowing them to further increase their overwhelming and growing dominance of the grocery industry.”

If the merger were to be approved, Kroger and Albertsons combined would operate more than 5,000 stores in 48 states, employing 700,000 people, according to the FTC. The two supermarkets are direct competitors. Kroger is currently the second largest food retailer in the United States, while Albertsons is the fourth largest. seconds in Axios.

“Albertsons Cos.'s merger with Kroger will expand competition, lower prices, increase associate wages, protect union jobs and improve the customer shopping experience,” an Albertsons spokesman told the DCNF. “If the Federal Trade Commission is successful in blocking this merger, it would hurt customers and help strengthen larger, multi-channel retailers like Amazon, Walmart and Costco, the very companies the FTC claims to be controlling, allowing- them to continue increasing their growing dominance of the grocery industry.”

The FTC, under Lina Khan's helm, has gone after several major companies for anti-competitive practices, included Amazon, which sued in September 2023 alleging that the company displayed a pattern of illegal conduct amounting to a monopoly.

A federal judge in July 2023 denied an FTC motion seeking to block a $68.7 billion merger between Microsoft and Activision. A judge in June 2021 dismissed an FTC antitrust complaint against Facebook over complaints that it has a monopoly on personal social networking services.

The FTC deferred to the DCNF in the press release.

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