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Arizona joins lawsuit against Kroger-Albertsons merger

By Kirsten Dorman
Associated Press
Published: Monday, February 26, 2024 - 1:56pm

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Bashas
Christina Estes/KJZZ
Bashas' was founded in Arizona in 1932 by brothers Ike and Eddie Basha Sr.

Arizona’s Kris Mayes joined a bipartisan coalition of state attorneys general and the Federal Trade Commission in filing a lawsuit to stop the largest proposed merger of grocery stores in the U.S.

Roughly a year ago, Mayes announced her office was launching an antitrust investigation into the merger between Kroger and Albertsons.

“We’ve been to Yuma, Prescott, Kingman, Sierra Vista, Tucson, two sessions in Phoenix,” she said in a YouTube video posted to her office’s channel that recaps its findings. “We were most recently in Green Valley.”

Community members voiced concerns about stores closing, loss of community jobs and access to food, especially in rural areas. In Maricopa County, there are already 55 food deserts — areas where affordable or good quality food is scarce.

The lawsuit says the merger would violate the federal Clayton Act, which bars mergers and acquisitions that would substantially lessen competition, or even create a monopoly.

Kroger and Albertsons, two of the nation’s largest grocers, agreed to merge in October 2022. The companies said a merger would help them better compete with Walmart, Amazon, Costco and other big rivals. Together, Kroger and Albertsons would control around 13% of the U.S. grocery market; Walmart controls 22%, according to J.P. Morgan analyst Ken Goldman.

Both companies, immediately after the FTC announcement, said that they will challenge the agency in court.

In a statement, Albertsons said it gives Arizona supermarkets a foothold to compete against retailers like Walmart, Costco and Amazon.

Full statement from Albertsons:

“Albertsons Cos. merging with Kroger will expand competition, lower prices, increase associate wages, protect union jobs, and enhance customers’ shopping experience. If the Federal Trade Commission is successful in blocking this merger, it would be hurting customers and helping strengthen larger, multi-channel retailers such as Amazon, Walmart and Costco — the very companies the FTC claims to be reining in – by allowing them to continue increasing their growing dominance of the grocery industry. In contrast, Albertsons Cos.’ merger with Kroger will ensure our neighborhood supermarkets can better compete with these mega retailers, all while benefitting our customers, associates, and communities. We are disappointed that the FTC continues to use the same outdated view of the U.S. grocery industry it used 20 years ago, and we look forward to presenting our arguments in Court.”

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