The Federal Trade Commission said more time is needed to deliberate on whether it will pass a proposed $25 billion merger between Kroger and Albertsons grocery stores.
As per the legal case, which customers of the two stores refiled, the companies and the Federal Trade Commission (FTC) are considering moving the deadline for a decision to January 17, 2024, up from December 15, 2023, according to the Cowboy State Daily.
As of Friday, no decision has been announced.
The deadline was set after paperwork submitted by Kroger was filed, certifying it had met the FTC’s antitrust law requirements. As part of the merger conditions, Kroger announced the sale of 413 stores to C&S Wholesalers. This move was adopted in order to keep the sector competitive.
According to Kroger, the merger is critical to ensuring the company can compete with other major players in the sector, like Walmart and Amazon. Critics of this argument, however, point to the fact that both Kroger and Albertsons continue to post better-than-expected earnings results.
The shopper lawsuit was first filed in the Northern District of California earlier in 2023 but was rejected by a judge in August. Since then, the litigants have amended and refiled their complaint.
Like the initial claim, the shoppers allege that the acquisition will eliminate any effective rival, reducing competition and ultimately shrinking alternatives for buying groceries.
According to a study by an economist from the University of Utah, the merger could reduce wages and working hours since employees in the sector would be unable to switch between employers for better pay. The paper went as far as to say the merger violates the Clayton Act by substantially harming competition in the grocery store sector.
