If you’re confused about what’s going on with the proposed $24.6 billion supermarket merger between Kroger and Albertsons, you wouldn’t be alone. Over the last few months, I’ve made something of a game asking the clerks at our neighborhood Safeway (which is owned by Albertsons) and nearby King Soopers (which is owned by Kroger) what they’ve heard or know, and not a single employee has any idea what’s going on.
Who can blame them? The merger was announced almost two years ago, but Uncle Sam is standing in the way. If somebody wants to sell and the other guy wants to buy, why stand in the way of the sale? Kroger and Albertsons – two of the country’s largest grocery chains – are squaring off in court against the Federal Trade Commission over charges the merger would create a monopoly and lead to higher prices. Representatives of both supermarket chains say the deal is needed to compete against behemoths Walmart and Costco.
Kroger estimates the deal would save consumers $1 billion and result in lower prices and higher wages for its workers. As the old saying goes, a rising tide lift all boats. Once upon a time, warding off monopolies in the grocery world may have been a legitimate concern, but those days are long gone.
Competition is everywhere these days, from the numerous Walmart groceries in town to Amazon, Sam’s, Costco, Trader Joe’s and even Target. As it is, Walmart holds 22% of the nation’s grocery sales and Kroger and Albertsons are 13% — combine.