Albertsons Kroger Merger Paused, Will East Wenatchee Safeway Still Be Sold?

The East Wenatchee Safeway was on a list of 600 stores Albertsons and Kroger released in April that would be sold to C & S Wholesale Grocers as part of a $25 billion merger

The divestiture was announced to help secure regulatory approval from the Federal Trade Commission (FTC) for the proposed merger that if approved, would be the largest in the history of the grocery industry.

The merger is now on pause while a lawsuit proceeds in Colorado, according to FOX Business News.  The two companies agreed to a temporary injunction pausing the merger until the Colorado lawsuit gets underway in September.

Washington state was the first to try and block the merger in January, followed by Colorado, the FTC and eight other states.

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FOX quoted a Kroger spokesperson speaking for both companies. "We look forward to defending in court how the combination of Kroger and Albertsons will provide meaningful, measurable benefits, including lower prices and more choices for families across the country and more opportunities for stable, well-paying union jobs."

In April of this year, Kroger's CEO said no stores will close as a result of the merger and that all frontline associates will remain employed.  Rodney McMullen also promised collective bargaining agreements would continue and employees will continue to receive their health care, pension benefits and negotiated wages.

But critics of the proposed merger fear store closures, lost jobs, and the potential of higher prices or less selection at the supermarket.

Why is the FTC concerned about Kroger and Albertsons Merging?

Kroger and Albertsons have argued the merger is necessary to compete with Amazon and Walmart.  If the companies merge, they would have a combine $48 billion market capitalization.  Walmart has a $478 billion market cap with 30% market share of the grocery business in the US   Amazon, which owns Whole Foods has a market cap of $1.8 Trillion

Even though the Kroger Albertson merger would represent a company that is dwarfed by by both Walmart or Amazon,  the FTC is concerned that Kroger and Albertsons are often each other's main  or only competition in many states throughout the western US.