Last summer, Hawthorne residents started wondering if Safeway would be going out of business with either Kroger or Albertsons taking over in the proposed merger. People commented on social media about whether the Kroger/Albertson’s merger would lower or raise grocery prices along with wages.
Kroger- the company that owns Smith’s and Ralph’s- began an acquisition deal with Albertsons in fall of 2022. Albertsons is the parent company of Safeway, and it currently owns approximately 51 grocery stores in Nevada, including the one in Hawthorne.
“We are bringing together two purpose-driven organizations to deliver superior value to customers, associates, communities and shareholders,” Kroger Chair and Chief Executive Officer Rodney McMullen said upon announcing the deal.
Kayla Anderson – Legislators are expecting the FTC to decide on allowing the Kroger/Albertsons deal in late February or March.
Kroger says that it prides itself on its affordable prices, quality customer experiences, and investing in its employees and their communities. At the time of its merger announcement, McMullen reiterated this in his testimony to the US Senate that it would not close any stores, distribution centers or manufacturing facilities…or lay off any frontline associates as a result of the merger.
However, in September 2023, it came out that 15 Nevada Albertsons stores were set to be sold if the merger went through. (A Kroger representative would not disclose the locations.)
The merger was supposed to be completed around this time; however, a few Nevada legislators are concerned about the possible monopoly and how it would profoundly affect the difference of prices and employee wages.
In December 2023, US Senator Jacky Rosen (D-NV) sent a letter to the FTC urging the Commission to review and consider blocking the Kroger/Albertsons merger over concerns that it could increase already-high food prices. With the strong presence both Kroger and Albertsons have in the state of Nevada, the merger means less competition and jobs/affordable food options could be at risk.
“Hardworking Nevada families in every corner of Nevada are being hit hard by rising food, gas, and housing prices,” says Senator Rosen. “This merger would reduce competition in the food industry and limit Nevadans’ choices, which could lead to price gouging and higher costs. Families deserve financial relief, and that’s why I’m fighting corporate mergers that line the pockets of their leaders at the expense of Nevadans.”
In response to the $23.6 billion merger agreement concerns, Nevada Attorney General Aaron D. Ford launched a Grocery Stores Merger Survey on the Attorney General website that is still live and accepting responses. The language in the introduction of the survey states:
“The merger may have potential impacts on grocery stores, consumers, employees, and others in the State of Nevada as well as nationwide. The companies expect to finalize the merger in early 2024, if it is approved by state and federal regulators. The Nevada Attorney General’s Office, pursuant to its authority under Nevada law, is reviewing this proposed merger to ensure it is proper, does not unfairly disrupt competition, and is fair to local grocery stores, consumers, employees, and others.”
C&S Wholesale has offered to buy 400 stores from the grocery corporations in a $1.9 billion deal in a divestment plan in an attempt to appease regulators.
Earlier this week, Ford told Axios that he’s considering the practicality of that deal but is concerned about possible “food deserts” in Nevada.
Legislators are expecting the FTC to decide on allowing the Kroger/Albertsons deal in late February or March. A few state attorney generals are planning to challenge it if the FTC moves forward; just last month the Washington Attorney General filed a lawsuit to block the deal.
Want to give your opinion and be part of the conversation? The Nevada Attorney General’s Grocery Stores Merger Survey is still open… visit https://ag.nv.gov/Hot_Topics/Grocery_Stores_Merger_Survey/ for more information.
