Alaska delegation applauds FTC block of Albertsons-Kroger merger

Earlier this week, the Federal Trade Commission sued to stop what might have been the largest supermarket merger in U.S. history, a move that was applauded by Alaska politicians who have opposed the deal.

Under the nearly $25 billion acquisition, Kroger, which is the parent company of Fred Meyer, would have taken over Albertsons, the parent company of Carrs-Safeway.

But the FTC in its complaint said that this merger would “substantially lessen competition” and could result in Americans paying millions of dollars more for food and other essential household goods.

Reducing the companies’ competition for staff would also reduce hundreds of thousands of workers’ ability to secure better wages and benefits, the FTC’s complaint said.

“This supermarket mega merger comes as American consumers have seen the cost of groceries rise steadily over the past few years,” Henry Liu, director of the FTC’s Bureau of Competition, said in a statement. “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. Essential grocery store workers would also suffer under this deal, facing the threat of their wages dwindling, benefits diminishing, and their working conditions deteriorating.”

Kroger and Albertsons had announced the deal in October 2022. In the fall of 2023, the companies revealed that this merger would entail selling off more than 400 stores nationwide, including 14 of 35 existing Carrs-Safeway stores in Alaska. That was part of the companies’ divestiture plan to avoid running afoul of antitrust laws. Those 14 Carrs-Safeway stores would have been sold to C&S Wholesale Grocers, which is headquartered in New Hampshire and does not currently operate in Alaska.

Ahead of the FTC’s suit, many Alaska lawmakers at both the state and national level noted that similar sales prompted by past mergers did not deliver on their promises of continued employment and competition. For example, in 1999, Safeway bought Alaska-based Carrs grocery stores. As part of the $330 million deal, they were required to sell seven Carrs stores to a competitor. Six of those stores, which were bought by Alaska Marketplace, shut down within a year.

“From the get-go, Alaskans have been the most outspoken about their concerns about corporate consolidations and monopolies, because Alaskans have the most to lose,” Rep. Mary Peltola, a Democrat and Alaska’s only congressperson in the U.S. House, said in a statement on Monday. “In my conversations with the FTC this morning, they told me the telephone town halls I hosted in November showcased Alaskan stories that made the difference in the FTC’s decision and have inspired a new kind of community involvement the FTC will strive to foster during future decision-making processes. I’m thrilled by this lawsuit and this big win for Alaska’s groceries.”

Senators Lisa Murkowski and Dan Sullivan, also hailed the decision.

“This announcement will come as a relief to countless Alaskans,” Sen. Murkowski said in a statement. “From the potential for even higher grocery prices to longer-term store closures, there were just too many unknowns and uncertainties for this merger to move forward.”