Kroger, Albertsons $24.6B merger temporarily blocked by Colorado judge

The Kroger, Albertsons merger was postponed on Thursday by a Colorado judge, who granted a preliminary injunction for a hearing in August.

The proposed $24.6 billion merger has been challenged in Colorado by the state attorney general. That’s in addition to a multi-state lawsuit led by the Federal Trade Commission and a separate lawsuit in Washington state.

Judge Andrew J. Luxen approved the preliminary injunction, which delays a hearing in Colorado scheduled for Aug. 12, according to a story in the Denver Gazette. That two-week hearing, which will be heard by Luxen, was moved to Sept. 30. 

"Defendants shall take any and all necessary steps to prevent any of their officers, directors, domestic or foreign agents, divisions, subsidiaries, affiliates, partnerships, or joint ventures from consummating, directly or indirectly, any such transaction," the court ruling said, according to the Denver Gazette.

A Kroger spokesperson released a statement following the ruling, calling it "welcome news as it eliminates the need for a preliminary injunction hearing in Colorado that was previously scheduled to begin August 12."

"The hearing on the state’s request for a permanent injunction will go forward as scheduled on September 30. We look forward to defending in court how the combination of Kroger and Albertsons will provide meaningful, measurable benefits, including lower prices and more choices for families across the country and more opportunities for stable, well-paying union jobs,” the Kroger statement added.

Related:What impact would the Kroger, Albertsons merger have on gas stations?

Colorado Attorney General Phil Weiser also released a statement: “I am pleased that Kroger and Albertsons agreed to halt their plans to merge until the court rules on the state’s lawsuit to permanently block the grocery merger. This is great news for shoppers, workers, farmers, and other suppliers, who can rest assured that this megamerger will not go into effect during harvest season and while kids are headed back to school. The trial is set to begin on September 30 and my office looks forward to making the case that this merger will eliminate competition and impact food prices, jobs, and consumer choice.” 

The hearing in the FTC case is set for Aug. 26 in Portland, Ore., That lawsuit is backed by attorneys general in Arizona, California, the District of Columbia, Illinois, Maryland, Nevada, New Mexico, Oregon, and Wyoming. 

Washington state has also filed a separate lawsuit to block the merger. 

As the court deadlines approach, the merger proposal has taken various turns over the last few months. In April, Kroger and Albertsons added 166 stores to its long list of locations it would divest to C&S Wholesale Grocers in an effort to appease federal regulators, bringing the total number of divested stores to 579. 

Related:Kroger and Albertsons release list of stores to be divested under merger

On July 9, the two grocers also released a detailed list of the stores that would be divested, including the locations. That includes nearly 150 gas stations that would be sold to C&S Wholesale Grocers.

Albertsons also made headlines on July 9, when a leaked memo revealed that its chief operating officer, Susan Morris, would leave the company to become president and CEO of retail at C&S Wholesale Grocers if the deal is approved. 

Unions have also maintained their opposition to the proposed acquisition, holding a press conference two days after the divestiture list was released, including union leaders from UFCW locals 7, 324, 400, 770, and 3000.

“Yesterday, you may have heard that Kroger and Albertsons released a list of 579 stores across the nation that they are proposing to divest to C&S Wholesale Grocers if the merger is allowed to proceed. Making this list public changes nothing,” UFCW 770 President Kathy Finn said. “The merger is not a done deal, and this coalition continues to do everything we can to stop it.”

On Thursday, UFCW 7, which represents 23,000 grocery, meat packing, food processing, healthcare, manufacturing, and cannabis workers in Colorado and Wyoming, released a statement praising the court decision to temporarily postpone the merger. "Our members and customers alike are concerned about potential job losses, food and pharmacy deserts, increased food prices, cost to food suppliers, and a lack of competition if the merger goes through," UFCW 7 President Kim Cordova said.

* This story was updated on 7/29/2024 to correct the location of the FTC case hearing.