Kroger Chair and CEO Rodney McMullen told SeafoodSource news that he is confident about the retailer’s position in its pending merger with Albertsons, as final arguments were starting Tuesday in the federal court case to decide whether it moves forward. Kroger merged with Fred Meyer in 1998, and Albertsons merged with Safeway in 2015, and had previously merged with Carrs in 1999.
McMullen said that the position of the companies is strong in their battle against Big Labor and big government, as they fight the U.S. Federal Trade Commission.
Rep. Mary Peltola has come out vocally against the merger of the grocery companies, which are trying to compete against a growing presence of Amazon and Walmart in Alaska’s food retail system. She has taken credit for stopping the companies from combining into one. Albertsons has already agreed to spin off Safeway/Carrs stores in Alaska in order for the merger to go through, but Democrats and labor unions still object.
“As we near the close of the FTC’s preliminary injunction hearing, we are confident in the facts and the strength of our position,” McMullen told the publication. “The food industry has always been competitive and will continue to be after this merger. We are committed to closing this merger because bringing Kroger and Albertsons together will provide meaningful and measurable benefits – lower prices, secure jobs and expanded access to fresh, affordable food – for customers, associates, and communities across the country.”
In lower court hearings, the companies claimed the merger would allow them to lower prices and more effectively compete with retail giants like Walmart, Costco, and Amazon, the Associated Press reported.
Read the rest of this story at SeafoodSource.com.
I’m not sure..Competing against Walmart, yes, because much of Walmart “brand foods” come from China and full of misc garbage…yes, but competing against Costco is a fairy tale. Costco has them beat in many.. many ways. They can’t compete with the food quality Costco provides for the price.
Yes & No. Costco quality is the best IMHO, esp. their beef. I am currently in VA and there is no competition when it comes to NY, Filets, sirloin. Best beef around here.
However, MANY consumers cannot afford the bulk purchases that make up many staple products at Costco. This is where Kroger’s can make in-roads. If I can save myself a trip to Costco to get the same TP at the Fred Meyer store within walking distance of my home for the same unit price, you can bet your behind that I’ll go to Fred’s.
I cut my Costco card in two when the two Costco founders spoke in support of B. Hussein Obama at a DNC national convention – in 2016, I think. Not sure what it means so far as this planned merger but the Juneau Carrs/Safeway hasn’t been maintained for years. All the urinals but one is completely covered in plastic and an out-of-order sign. Rest of the store looks in similar disrepair. The Fred Meyer has no non-food not made in China so far as I can see – worse than Walmart, but Walmart left here years ago.
The state has been investing heavily into both increasing the SNAP enrollment and hiring more state workers to meet the increased demand for SNAP. It will therefore require more and more of the PFD to “hold harmless” Alaska SNAP enrollees. There is some sort of lesson here for Alaskans but I am not smart enough to know what it is. One fellow says Alaska state government has given up on farms and factories, and is now focused on food stamps and fentanyl.
This is such a terrible deal for Alaska. The Carr’s here in Anchorage cannot keep yogurt, eggs and milk in stock. So many times the aisle is bare. Milk is almost always 50% off for a majority of when it is in stock. Safeway distribution is not like Fred Meyer. Very few times is Fred Meyer discounting milk and their aisles are hardly ever bare.
Now put in a company that doesn’t have experience on logistics to Alaska and you think they are going to be a better competitor than Carrs? In Hawaii there is only Safeway’s and local supermarkets. Check your apps to see the price difference on almost every single product. Way Way higher. Don’t say it is transportation costs as the Jones Act makes sure the prices are the same whether you ship to Alaska or Hawaii, (I know, I ship products to both places. The Jones Act is the number 1 reason costs are higher in Alaska and Hawaii and PR.). The high price in Hawaii is the lack of competition of the majors. Walmart prices don’t compare since they never run sales and Costco only has bulk. Fred Meyer and Safeway already can compete with them, there is no need for them to merge.
Ducan, your opinion is not correct based on my direct experience. We buy groceries in both the Anchorage area and on the Big Island, and we routinely read the ads for stores in both locations. Both locally owned KTA and Foodland are competitive and frequently less expensive than Fred Meyer and Safeway. Costco prices are usually identical. Three Bears is in between Costco and the big chain groceries. You just have to shop the sales.
What’s scary is the list of stores that will close because of this merger. In Juneau they would close the Safeway which is a large and very busy store. Those people would be forced to go to the IGA Superbear store which is very small or travel to the Fred Meyer which is also a very busy store with a constantly full parking lot.
Yep. They are going to starve us out by buying up and closing all of the stores except their few that they will control with digital id.
If Mary Peltola is against the merger, I am for it!
Hmmm, I read the linked article. Seems Kroger’s profit on ‘groceries’ last year was 50 basis points. They are projecting 0.75 to 1.75% for 2024 on the same gross sales. That’s not much of a margin. Also, it appears the combined company will have revenues on the order of $200 bn, about 80% of Costco annual revenue and 30% of Walmart revenues. In that I don’t see Walmart or Costco leaving Alaska, I’m not certain how the merged company’s improved buying power won’t help keep prices low. We’ve certainly see a rise in prices in Los Anchorage during the last two years.
Perhaps in smaller communities where there are only two stores they might drive the other out of business??? I ponder that they are not in those markets now. We do live in interesting times.
Wow! Nothing like getting down to a couple of huge grocery chains. What could possibly go wrong for the consumer??
invest more PFD dollars in 3 Bears. our retreating economy isn’t providing the capital returns needed by investors. ask booth school and Milton Friedman how markets will solve this.
anyone remember airline deregulation? didn’t increase but collapsed regional airlines. my point? we’ll be serviced like regional airports. ask Iowa, Montana and Kenai.
the slowing economy is going to make rural lifestyles expensive, dwindling populations. people move to jobs and where families, kids can have the best future outcomes.
no political discourse will solve Econ 101 issues. Hyak lost to Keynes. Friedman is losing steam. Laffler curve was a dupe that gutted the middle class. 40 years later the truth hurts
Three Bears – IF the state is not in on the scheme to control our food supply and starve us out.
This merger only benefits Kroger.
…”will provide meaningful and measurable benefits – lower prices, secure jobs and expanded access to fresh, affordable food…” The only benefit will be to the merged company, its management, and its stock price. We’ll see: higher prices, laid-off workers, stale food, less selection, poor quality, and a lot of angry consumers. Don’t buy their merger-marketing lies. Reduced competition ALWAYS hurts the customer.
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