The Kroger-Albertsons merger has been announced on Friday. This merger can create a huge grocery supermarket organization as the two largest grocers are involved in it. Kroger currently owns nearly two-dozen chains and Albertsons owns 24.
The merged organization will have more than 5,000 stores and the annual income is expected to remain at $200 billion.
The deal has been finalized at $24.6 billion. It has yet to be approved by the regulating authorities. If everything goes fine then the deal will finally be struck in 2024.
The Kroger-Albertsons merger, if it is approved by Federal Trade Commission, is going to give tough competition to the giants like Amazon, Walmart, Costco, etc.
Apart from this, Kroger plans to do further investments in its own company as well as in Albertsons. This move is expected to lower the prices of food for customers. But experts are having their own opinions. They are afraid that this merger will lead to a further rise in prices.
This opinion of the experts is based on a study that was done in 2008. This study showed that most such mergers result in higher prices.
At the moment, both companies operate in 48 states and Washington D.C. In certain parts they both have stores. It is quite possible that some of the stores would be closed where overlapping is present.
It is also possible that the merged organization may divest 100 to 375 stores and place them into a new subsidiary of Albertsons.
Well, the Kroger-Albertsons merger is currently facing opposition from certain sections of society as it may result in higher food prices and even laying off employees. Senate Judiciary’s antitrust subcommittee also announced on Tuesday that it will be holding a hearing next month to scrutinize the merger.