The attempted $24.6 billion merger between Kroger and Albertsons marked one of the most significant developments in the U.S. grocery retail sector in recent years. It drew national attention and sparked debate over competition, market consolidation, and the role of government regulation in protecting consumers.
1. The FTC’s Legal Challenge
In early 2024, the Federal Trade Commission (FTC), alongside several state attorneys general, filed a lawsuit to block the merger. The FTC argued that combining two of the largest supermarket chains in the country would reduce competition, potentially leading to higher prices for consumers and lower wages for workers. In December 2024, the U.S. District Court in Oregon granted a preliminary injunction, effectively halting the merger.
2. Divestiture Plan Rejected
To address antitrust concerns, Kroger and Albertsons proposed selling over 500 stores to C&S Wholesale Grocers. However, the FTC dismissed the plan as insufficient, calling it a collection of unrelated assets that would not create a viable competitor capable of keeping the market balanced.
3. Albertsons Sues Kroger
Following the deal’s collapse, Albertsons filed a lawsuit against Kroger, alleging that Kroger failed to use its best efforts to secure regulatory approval. Albertsons claimed Kroger’s approach to divestitures was uncoordinated and inadequate, contributing to the failure of the merger.
4. Broader Implications for Retail M&A
The case has had a ripple effect across the retail and grocery industry. It reinforced the FTC’s tougher stance on corporate mergers and sent a clear message to major players that future deals will be closely examined. For retailers and investors, it demonstrated the need for detailed, transparent, and proactive regulatory strategies.
This failed merger attempt will be remembered as a defining moment in modern U.S. retail history, one that may shape how future supermarket consolidations are proposed, negotiated, and scrutinised.