U.S. Lawmakers Set Hearing On Kroger Grocery Mega Merger – Reuters

WASHINGTON, Oct 18 (Reuters) – U.S. senators who scrutinize antitrust issues expressed “serious concerns” about grocery company Kroger Co’s plan to buy rival Albertsons Cos Inc (ACI.N), and said they would hold a hearing next month on the $25 billion deal.

The announcement by Democratic Senator Amy Klobuchar, chair of the Senate Judiciary Committee antitrust panel, and Republican Senator Mike Lee confirmed a previous report by Reuters.

Separately, Klobuchar and fellow Democrats Richard Blumenthal and Cory Booker released a letter expressing concern about the deal.

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“As food prices remain elevated, too many American families are struggling to put food on the table,” they wrote to Federal Trade Commission Chair Lina Khan. “This merger raises considerable antitrust concerns.”

The FTC is expected to review the deal to ensure it complies with antitrust law.

The $25 billion mega merger between the No. 1 and 2 standalone grocers in the United States will bring under one roof nearly 5,000 stores that include banners such as Albertsons’ Safeway and Kroger-owned Ralphs and Fred Meyer.

To ease antitrust concerns, the companies said they plan to divest some stores and that Albertsons is ready to spin off a standalone unit to its shareholders immediately before the deal’s close, expected in early 2024. The new public company is estimated to comprise as many as 375 stores.

But the Democrats in their letter pointed to criticism over a remedy for Albertsons’ 2015 purchase of Safeway. At that time, the FTC required more than 150 stores to be sold but eventually allowed many to be re-purchased by Albertsons to prevent them from closing.

Lee on Friday also vowed the deal would receive scrutiny.

Market leader Walmart has been doubling down on its own grocery business and has traditionally used its scale to demand the lowest possible prices from food and beverage suppliers, leaving rivals at a disadvantage in price negotiations.

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Reporting by Diane Bartz; Editing by Franklin Paul and Josie Kao

Our Standards: The Thomson Reuters Trust Principles.

Diane Bartz

Thomson Reuters

Focused on U.S. antitrust as well as corporate regulation and legislation, with experience involving covering war in Bosnia, elections in Mexico and Nicaragua, as well as stories from Brazil, Chile, Cuba, El Salvador, Nigeria and Peru.

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