Kroger is denying Albertsons’ claims that it didn’t do enough to ensure regulatory approval of the companies’ planned supermarket merger, according to the Associated Press.
In court papers filed Tuesday in the Delaware Court of Chancery, Kroger said Albertsons disregarded the companies’ merger agreement and worked secretly with a partner, C&S Wholesalers, to try to force Kroger to divest more stores to C&S.
Kroger also claimed that Albertsons was secretly planning to sue Kroger if the deal didn’t go through long before the merger actually fell apart in December. Kroger said in Tuesday’s court filing that it should not be forced to pay Albertsons a $600 million termination fee as well as billions of dollars in legal fees.
In a statement Tuesday, Albertsons said it was Kroger that failed to honor the merger agreement.
“Kroger’s self-interested conduct doomed the merger, and we are now focused on returning value to Albertsons’ shareholders to compensate for those losses,” Albertsons said.
Kroger and Albertsons first proposed the merger in 2022. They argued that combining would help them better compete with big retailers like Walmart and Costco. However, the Federal Trade Commission and two states — Washington and Colorado — sued to block the merger last year, saying it would raise prices and lower workers’ wages by eliminating competition. It also said Kroger and Albertsons’ plan to divest 579 stores C&S Wholesalers was inadequate to ensure competition, since C&S was ill-equipped to take on so many stores.
In December, judges in Washington and Oregon halted the merger in two rulings issued within hours of each other.
