Washington state Attorney General Bob Ferguson on Monday sued to block the proposed merger of Kroger and Albertsons, two of the nation’s largest grocery chains.
In the suit filed in King County Superior Court, Ferguson argued that the $25-billion deal would harm consumers and raise prices, The Seattle Times reported. It’s the first regulatory move to stop the merger, according to the outlet.
“This merger is bad for Washington shoppers and workers,” Ferguson said in a news release Monday. “Shoppers will have fewer choices and less competition, and, without a competitive marketplace, they will pay higher prices at the grocery store.”
Kroger and Albertsons have more than 300 locations in the state and account for more than half of its grocery sales, according to the suit.
Kroger, which owns QFC and Fred Meyer and is based in Cincinnati, is seeking to acquire Albertsons, which owns Safeway and Haggen and is based in Boise, Idaho.
The Federal Trade Commission is also expected to review the merger next month, Axios recently reported. And California is also considering a lawsuit, Reuters reported last year.
In a statement Monday, Kroger said it was pushing back its timeline for closing the deal due to ongoing dialogue with regulators, including state attorneys general and the Federal Trade Commission. It now anticipates the closure may occur in the first half of its fiscal year, which ends in mid-August.
“While this is longer than we originally thought, we knew it was a possibility and … accounted for such potential timing,” the statement said.
The company claimed the merger will bring lower prices for consumers.
Ferguson’s lawsuit was endorsed by United Food & Commercial Workers, Local 3000, which represents Kroger and Albertsons employees in Washington, northeast Oregon and northern Idaho, The Seattle Times reported.
However, an analysis last year from the left-leaning Economic Policy Institute concluded that if the merger proceeds, more than 700,000 grocery workers in 50 U.S. cities would see lower pay, with a collective loss totaling over $330 million.
“Workers, shoppers and our communities need to prevent this proposed mega-merger from taking place,” Yasmin Ashur, a union member who works in an Albertsons grocery store, said in a union statement Monday.
Last year, seeking to clear a path for a merger, Kroger and Albertsons announced plans to sell more than 400 stores and other assets to C&S Wholesale Grocers, a wholesale grocery supplier, amid concerns about market dominance.
Kroger and Albertsons agreed to merge in 2022. The grocery chains say they must merge to compete with Walmart, Amazon and other major companies that have stepped into the grocery business.
