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FTC Sues Kroger

The US Federal Trade Commission and nine states sued to block supermarket chain Kroger's $25B acquisition of competitor Albertsons yesterday, arguing the move would raise prices, lower wages, and reduce competition in the industry. The proposed deal, first announced in 2022, would be the largest in supermarket chain history.


The grocers, who together would control 13% of the US grocery market, claim the merger would enable them to better compete with dominant retailers Walmart, Costco, and Amazon. The lawsuit comes six months after Kroger sought to mitigate scrutiny of the deal by divesting 400 of its stores, a move the FTC claims in its lawsuit will not increase competition. The suit is part of a broader crackdown on large mergers by the Biden administration, including last summer's failed bid to prevent Microsoft's $70B acquisition of Activision Blizzard.


The dispute comes amid a three-decade high in the percentage of income Americans spend on groceries, even as broader inflation cools. 

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