The state of Colorado will be allowed to independently challenge the $24.6 billion Kroger, Albertsons merger, and a hearing is set for Aug. 12, reports Reuters.
After listening to arguments for more than an hour on Monday, District Court Judge Andrew Luxen said he would work to deliver his ruling quickly.
Luxen’s decision means the Colorado case will be heard earlier than a lawsuit over the merger from the Federal Trade Commission (FTC) and eight other states. The hearing in that case is expected to begin on Aug. 26.
The injunction involving the agency and states would prevent the two companies from merging while the FTC conducts an in-house challenge, which would be overseen by an administrative law judge at the agency. The FTC had previously set a July 31 date for an evidentiary hearing in that case to begin. That hearing would take place in Washington, D.C.
Washington state is also suing both Kroger and Albertsons over the merger, and that hearing is expected to begin on Sept. 16 in Seattle.
Meanwhile, Matthew Wolf, an attorney for Kroger, said during Monday’s hearing in Denver that a new divestiture package for the merger is expected to surface in the coming days.
The FTC has not been a fan of the idea of divesting 413 Kroger and Albertsons stores to C&S Wholesale Grocers because of C&S’s lack of experience in the retail sector.
Kroger and Albertsons both filed sharply worded responses following the FTC’s lawsuit.
“The commission’s claims are premised entirely on the commission’s distortion and willful ignorance of basic but critical facts,” Albertsons said in its comments.
Albertsons said the commission “entirely ignores” the realities of the competitive grocery landscape. It cited competition from other grocery retailers, including Walmart, Target, Costco, Amazon/Whole Foods, other specialty grocers such as Trader Joe’s and Sprouts, and dollar stores. Albertsons cited Costco in particular as one of the company’s “most fervent competitors.”
Kroger defended the selection of C&S Wholesale Grocers as a divestiture partner.
“C&S is not a mom-and-pop operation or a risky private equity venture,” Kroger said in its filing. “It is a well-capitalized company with deep industry experience.”
In the conclusion of its comments, Albertsons said the FTC’s assertion that the merger would harm competition in both the retail grocery and grocery labor markets was based on “so-called ‘facts’” that ignore the realities of the market.
