Federal Judge Blocks $24.6 Billion Kroger-Albertsons Merger

A federal judge has blocked the proposed $24.6 billion merger between Kroger Co. and Albertsons Companies Inc., halting what would have been the largest supermarket consolidation in U.S. history. U.S. District Judge Adrienne Nelson issued a preliminary injunction on December 10, 2024, siding with the Federal Trade Commission (FTC) and several state attorneys general who argued that the merger would reduce competition, potentially leading to higher grocery prices and diminished choices for consumers.

The merger, announced in October 2022, aimed to combine Kroger and Albertsons into a retail giant operating nearly 5,000 stores and employing approximately 700,000 individuals across 48 states. Proponents of the deal contended that the consolidation would enhance their ability to compete with industry leaders like Walmart and Amazon.

However, the FTC, along with attorneys general from nine states and the District of Columbia, filed a lawsuit in February 2024 to block the merger. They argued that the consolidation would eliminate direct competition between the two chains, leading to higher prices for essential groceries and negatively impacting workers' wages and benefits. Henry Liu, Director of the FTC’s Bureau of Competition, stated, "Kroger’s acquisition of Albertsons would lead to additional grocery price hikes for everyday goods, further exacerbating the financial strain consumers across the country face today."

In response to regulatory concerns, Kroger and Albertsons proposed divesting several hundred stores to C&S Wholesale Grocers. The FTC deemed this divestiture plan inadequate, stating it failed to mitigate the loss of competition between the two supermarket chains.

Judge Nelson's ruling emphasized the potential anticompetitive effects of the merger. She noted that the proposed acquisition was likely to lead to unilateral competitive effects and was presumptively unlawful. The court concluded that the merger would harm consumers and workers by reducing competition in the grocery industry.

The decision has significant implications for consumers, workers, and the broader grocery market. Blocking the merger is seen as a victory for antitrust enforcement, aiming to maintain competitive markets and prevent monopolistic practices in the grocery industry.

Both Kroger and Albertsons expressed disappointment with the court's decision and indicated they are reviewing their options. The ruling underscores the heightened scrutiny of large mergers, especially in essential sectors like grocery retail, and reflects the FTC's commitment to enforcing antitrust laws to protect consumers and workers.

As of June 17, 2025, Kroger's stock price stands at $65.93, while Albertsons' stock is priced at $21.32.