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Albertsons (NYSE:ACI) fell almost 1%, at least partly amid a report that several U.S. lawmakers are urging the Federal Trade Commission to block Kroger’s (NYSE:KR) planned $25 billion purchase of the supermarket chain.
Senators Elizabeth Warren (D-MA), Mazie Hirono (D-HI), Bernie Sanders (I-VT), Cory Booker (D-NJ), and representatives Summer Lee (D-PA) and Alexandria Ocasio-Cortez (D-NY) said Kroger’s (KR) plan to divest 413 stores to C&S Wholesale Grocers wouldn’t address harms to consumers, workers and the grocery industry, according to a letter the lawmakers wrote to the FTC.
“A Kroger-Albertsons merger would net the five largest food retail companies control of 55 percent of all grocery sales,” the lawmakers wrote in the letter. “The newly merged entity could use its dominant position to further control and ultimately raise consumer prices.”
The latest opposition to the mega supermarket deal comes after the Teamsters Union said on Monday said it’s against Kroger’s plan to sell stores to C&S Wholesales to try to win antitrust approval. In August, seven states also requested that the FTC block the supermarket deal.
Kroger (KR) confirmed on its Q3 earnings call late last month that it filed substantial compliance with the FTC’s second request on the Albertsons (ACI) deal on Nov. 15.
Kroger (KR) has a timing agreement with the FTC that expires on Jan. 17, according to a Dealreporter item on Tuesday. The parties said in an October court filing involving a shareholder lawsuit they wouldn’t close before Feb. 13.
There is a motion to dismiss the shareholder suit, so this timeline guidance may not be relevant if or when the lawsuit is dismissed, a source told Dealreporter.
News of the lawmaker letter was earlier reported by Reuters.
FTC Chair Lina Khan has said she doesn’t expect the antitrust regulator to make a decision on the $25 billion purchase until next year.