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Albertsons again must hold off on $4 billion special dividend

Hearing set for next week on payment connected with Kroger merger deal

Russell Redman

November 11, 2022

2 Min Read
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King County Superior Court in Washington state has scheduled a Nov. 16-17 hearing on whether to grant a preliminary injunction against the Albertsons special dividend payment, originally slated to be made on Nov. 7.Albertsons Cos.

Albertsons Cos.’ planned $4 billion special dividend payment, related to its merger agreement with The Kroger Co., has been delayed again.

King County Superior Court in Washington state yesterday set a hearing for Nov. 16 and 17 on whether to grant a preliminary injunction against the dividend payment. The move came after Judge Ken Schubert, in State of Washington v. Albertsons Companies Inc. et al. (Cause No. 22-2-18046-3), heard arguments from state attorneys and the supermarket chains in a 3 p.m. (PST) Zoom hearing.

Albertsons’ special dividend of $6.85 per common share was scheduled to be paid Nov. 7 but remains suspended under a temporary restraining order (TRO) attained Nov. 3 by Washington State Attorney General Bob Ferguson through the King County Superior Court. The TRO blocked the payment of the dividend until at least the hearing on Nov. 10.

“Albertsons Cos. continues to believe that the claim brought by the state of Washington is meritless and provides no legal basis for canceling or postponing a dividend that has been duly and unanimously approved by Albertsons Cos.’ fully informed board of directors,” Boise, Idaho-based Albertsons said Thursday evening in a statement on the rescheduled hearing.

On Nov. 8, the U.S. District Court for the District of Columbia denied a request by the attorneys general of California, Illinois and D.C. for a TRO to halt Albertsons planned dividend payment. The TRO in Washington state, though, remained in effect and suspended the payment. D.C. AG Karl Racine said in a Nov. 4 joint status report filing that he plans to move for a preliminary injunction after the court rules on the Washington state TRO.

Related:Albertsons: D.C. court nixes action to suspend $4B special dividend

Kroger and Albertsons announced their $24.5 billion merger deal on Oct. 14, in which the nation’s largest supermarket retailer (Kroger) plans to acquire the second-largest (Albertsons). The companies said they expect the transaction to close in early 2024, but industry observers said regulatory clearance could take up to two years.

The AGs of D.C., California and Illinois last week had filed suit to stop the Albertsons dividend payment pending a full review of the merger agreement by state and federal regulators. Efforts to stop the dividend claim that its size will impede Albertsons’ operations and ability to compete during the merger deal’s antitrust review, in turn negatively affecting workers and shoppers.

The lawsuits followed a letter sent late last month to Albertsons CEO Vivek Sankaran and Kroger Chairman and CEO Rodney McMullen urging them to suspend the dividend payment. The letter — signed by Ferguson (D.) , Racine (D.) and state AGs Mark Brnovich (R.) of Arizona, Rob Bonta of California (D.), Lawrence Wasden (R.) of Idaho and Kwame Raoul (D.) of Illinois — asked Albertsons to respond by Oct. 28. However, the grocer declined to hold off on the dividend payment.

Related:Court halts Albertsons’ $4B dividend payment under Kroger merger deal

About the Author

Russell Redman

Senior Editor
Supermarket News

Russell Redman has served as senior editor at Supermarket News since April 2018, his second tour with the publication. In his current role, he handles daily news coverage for the SN website and contributes news and features for the print magazine, as well as participates in special projects, podcasts and webinars and attends industry events. Russ joined SN from Racher Press Inc.’s Chain Drug Review and Mass Market Retailers magazines, where he served as desk/online editor for more than nine years, covering the food/drug/mass retail sector. 

Russell Redman’s more than 30 years of experience in journalism span a range of editorial manager, editor, reporter/writer and digital roles at a variety of publications and websites covering a breadth of industries, including retailing, pharmacy/health care, IT, digital home, financial technology, financial services, real estate/commercial property, pro audio/video and film. He started his career in 1989 as a local news reporter and editor, covering community news and politics in Long Island, N.Y. His background also includes an earlier stint at Supermarket News as center store editor and then financial editor in the mid-1990s. Russ holds a B.A. in journalism (minor in political science) from Hofstra University, where he also earned a certificate in digital/social media marketing in November 2016.

Russell Redman’s experience:

Supermarket News - Informa
Senior Editor 
April 2018 - present

Chain Drug Review/Mass Market Retailers - Racher Press
Desk/Online Editor 
Sept. 2008 - March 2018

CRN magazine - CMP Media
Managing Editor
May 2000 - June 2007

Bank Systems & Technology - Miller Freeman
Executive Editor/Managing Editor
Dec. 1996 - May 2000

Supermarket News - Fairchild Publications
Financial Editor/Associate Editor
April 1995 - Dec. 1996 

Shopping Centers Today Magazine - ICSC 
Desk Editor/Assistant Editor
Dec. 1992 - April 1995

Testa Communications
Assistant Editor/Contributing Editor (Music & Sound Retailer, Post, Producer, Sound & Communications and DJ Times magazines)
Jan. 1991 - Dec. 1992 

American Banker/Bond Buyer
Copy Editor
Oct. 1990 - Jan. 1991 

This Week newspaper - Chanry Communications
Reporter/Editor
May 1989 - July 1990

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