California AG Bonta files lawsuit against Kroger, Albertsons

California Attorney General Rob Bonta, the Federal Trade Commission, and a bipartisan coalition of states, announced the filing of a lawsuit that challenges the proposed merger of Kroger (KR) and Albertsons (ACI). Kroger and Albertsons are the two largest national supermarket chains in the country and this merger presents a significant risk of reduced competition and higher food prices nationwide. In California specifically, Kroger’s $24.6B purchase of Albertsons is expected to further consolidate the highly concentrated retail grocery market in Southern California, leading consumers to face fewer choices and higher prices. The merger is also expected to reduce the ability of unions to negotiate working conditions at these stores, impacting thousands of employees in California. “This megamerger is bad for workers, for agricultural producers, and for California communities. In some markets in Southern California, Kroger-Albertsons is expected to be the only one-stop grocery option. Today, we are going to bat for a more just and competitive economy, one where companies need to compete for labor and where prices and service matter,” said Attorney General Bonta. “This merger will leave Californians with limited choices over where to shop – and for workers in this industry, where to work. As many families continue to feel the burden of inflation, fighting corporate consolidation that threatens to increase prices and reduce service is more important than ever.” The lawsuit seeks to block the proposed Albertsons-Kroger merger, alleging it is in violation of the federal Clayton Act, which prohibits the acquisition of assets where the effect of such acquisitions may substantially lessen competition or create a monopoly.