The between supermarket giants Kroger and Albertsons floundered on Tuesday after judges overseeing two separate cases both halted the merger.
U.S. District Court Judge Adrienne Nelson issued a preliminary injunction blocking the merger Tuesday after holding a in Portland, Oregon.
Later Tuesday, Judge Marshall Ferguson in Seattle issued a permanent injunction barring the merger in Washington after concluding that it would lessen competition in the state.
Kroger and Albertsons in 2022 proposed what would be the in U.S. history. But the earlier this year, asking Nelson to block the $24.6 billion deal until an in-house administrative judge at the FTC could consider the merger鈥檚 implications.
Nelson agreed to pause the merger.
鈥淎ny harms defendants experience as a result of the injunction do not overcome the strong public interest in the enforcement of antitrust law, especially given the difficulty in disentangling a premature merger,鈥� she wrote in her opinion.
Federal regulators argue that combining the two chains would be by eliminating competition. a merger would help them better compete with big retailers like Walmart, Costco and Amazon.
The case may now move to the FTC, although Kroger and Albertsons have asked a different federal judge to block the in-house proceedings. and are also trying to halt the merger in ongoing state trials. The judge in Washington was expected to release his opinion later Tuesday.
The FTC argued that Kroger and Albertsons currently compete in 22 states, closely matching each other on price, quality, private label products and services like store pickup. A merger would and raise prices for already , the government said. The FTC also said the merger would hurt workers since Kroger and Albertsons would no longer compete to hire them.
But Kroger and Albertsons argued their merger would preserve consumer choice by allowing them to better compete against its growing rivals. In its testimony, that it might have to lay off workers, close stores and even exit some markets if the merger weren't allowed to proceed.
Under the merger agreement, Kroger and Albertsons would in places where their locations overlap to , a New Hampshire-based supplier to independent supermarkets that also owns the Grand Union and Piggly Wiggly store brands.
The FTC argued that C&S is ill-prepared to take on the stores and may want the option to sell or close them. But Kroger and Albertsons said C&S has the experience and national scale to handle the divestiture.
, based in Cincinnati, Ohio, operates 2,800 stores in 35 states, including brands like Ralphs, Smith鈥檚 and Harris Teeter. , based in Boise, Idaho, operates 2,273 stores in 34 states, including brands like Safeway, Jewel Osco and Shaw鈥檚. Together, the companies employ around 710,000 people.
Dee-ann Durbin, The Associated Press
