Kroger CEO is ready to fight hard for merger approval

Kroger CEO Rodney McMullen says the company's legal team has been warming up for quite some time.

In a recent interview with Bloomberg, McMullen said lawyers were assembled way out in front of the $24.6 billion merger announcement with Albertsons. He said the team is ready to do whatever it takes to sway any judge if the Federal Trade Commission (FTC) blocks the deal, even if the fight takes months.

Kroger and Boise, Idaho-based Albertsons continue to work with the FTC over the merger, and McMullen said everything is on schedule. The grocery chief also believes the best professional advisors are being used and told Bloomberg when it is all said and done a Kroger, Albertsons partnership would create a healthy environment with lower prices. He also said he believes the store divestitures will go smoothly. McMullen said there are a handful of potential buyers who could take on the purchase without much debt. It is not clear whether the entire lot of divested stores, which could be as many as 650, would be sold to one buyer or to multiple companies.

Recently the United Food and Commercial Workers International Union (UFCW) voted to reject the Kroger, Albertsons merger.

“Given the lack of transparency, and the impact a merger between two of the largest supermarket companies could have on essential workers – and the communities and customers they serve – the UFCW stands united in its opposition to the proposed Kroger and Albertsons merger,” said UFCW International President Marc Perrone.

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Shortly after the vote, McMullen and Albertsons CEO Vivek Sankaran released a joint op-ed in the Cincinnati Inquirer answering three common myths, with two of them dealing with store closings as part of the merger agreement and the impact to unions.

The Economic Policy Institute recently released a policy memo claiming that workers at all grocery workers, not just those at Kroger and Albertsons, could lose a total of over $330 million annually if the deal goes through.

The institute used grocery store employment and earnings data at specific Kroger and Albertsons stores to draw up the following findings:

Related:Amazon could look to acquire Kroger, Albertsons stores

“We have and will continue to engage constructively with the UFCW regarding the merger benefits and our divestiture plan, which includes no store closures or frontline associate layoffs as a result of the transaction. The merger is a win for our associates, customers and communities,” Kroger said in an email statement to SN. “The only parties who would benefit if this merger is not completed are large, non-unionized competitors such as Walmart and Amazon.”