Senator Sullivan applauds FTC move to block Albertsons-Kroger merger

Last week, the Federal Trade Commission (FTC) filed an administrative complaint to block a proposed merger between grocery chains Kroger and Albertsons, saying the $24.6 billion deal would eliminate competition and lead to higher prices for millions of Americans. The FTC complaint will be considered by an administrative law judge at the agency.

The agency also filed a lawsuit with the U.S. District Court in Oregon requesting a temporary injunction blocking the merger. That lawsuit was joined by the attorneys general of eight states, as well as the District of Columbia.

The move is met with support from Senator Dan Sullivan, who expressed his support on Monday, saying: “As Senator Murkowski and I wrote in a letter to the FTC last September, the fact that this merger could result in grocery store closures and higher prices in Alaska—a state that already has some of the highest prices for food and basic goods in the country—had many Alaskans very concerned. We demanded that the FTC conduct a rigorous analysis to ensure that Alaskans would not be negatively impacted by this merger. In that analysis, the FTC found that the merger would likely reduce competition and raise prices—putting further strain on working families in our state who are being crushed by the high inflation caused by the Biden administration’s policies. I appreciate and support the FTC’s thorough analysis and decision to take action to block this merger for the benefit of Alaskans.”

“This is a big win for consumers and Alaska working people, and particularly of rural Alaska who already have fewer choices in food,” said Joel Hall, head of the AFL-CIO for Alaska. The FTC action will freeze action on the merger, but Hall said she expects eventual litigation from the grocery chains to overturn the FTC decision.

Last year, Senator Sullivan and Senator Lisa Murkowski raised concerns regarding the supermarket acquisition in a letter sent to FTC Chair Lina Khan, citing the effects on consumer prices, the state’s food security, and Alaskan employees.

Alaska Representative Mary Peltola also authored a letter to the FTC requesting the proposed merger between Kroger and Albertsons grocery chains be blocked.

“Alaska already has an incredibly concentrated grocery store market, and potential divestments of stores resulting from the merger would threaten both competition and basic food security in many communities across the state. The five largest jurisdictions by population in Alaska are Anchorage, the Matanuska-Susitna Borough, Fairbanks, Juneau, and Kenai-Soldotna. In each of these communities, Fred Meyer (Kroger) and Carrs (Albertsons) are the primary competitors selling groceries and household goods,” she wrote, adding, “If the proposed merger goes through, store closures and reduced competition could result in a significantly reduced competition, or even a near-monopolistic landscape in a state that already has some of the highest costs of living in the United States.”

Last year, Kroger announced a $1.9 billion divesture agreement, proposing to sell 14 of the 35 Carrs-Safeway stores in Alaska, which could pose a threat to Alaska grocery workers.

"This mega-merger would hurt all Alaskans, but especially the workers at potentially impacted stores. A successful mega-merger would likely lead to store closures and hundreds - possibly thousands - of lost jobs, many of which come with family-sustaining wages, top of the line health insurance, and a pension. Alaskans should be thankful Representative Peltola is speaking up on this issue and defending Alaska consumers and workers from the harmful impacts of a corporate monopoly," said Hall last year.

Kroger and Albertsons are two of the nation’s largest grocers, each operating major grocery stores in Alaska. Kroger runs Fred Meyer stores, and Albertsons operates the Carrs-Safeway chain. If the $24.6 billion merger is allowed, the joint company would be a similar size to Walmart and Amazon. Both companies have said that a merger would help them better compete with Walmart, Amazon, Costco and other big rivals.

Immediately after the FTC announcement, both companies said that they will challenge the agency in court. The Kroger Company issued a statement on their website, saying that the FTC's decision makes it more likely that America's consumers will see higher food prices and fewer grocery stores at a time when communities across the country are already facing high inflation and food deserts and serves to only strengthens larger, non-unionized retailers like Walmart, Costco and Amazon by allowing them to further increase their overwhelming and growing dominance of the grocery industry.

“The proposed merger with Albertsons Cos. will produce meaningful and measurable benefits for customers, associates and communities across the country. The combined company committed that no stores, distribution centers or manufacturing facilities will close as a result of the merger, including those divested to C&S Wholesale Grocers. Customers will benefit from lower prices and more choices following the merger close.”