Kroger and Albertsons courtroom drama heads to Delaware — for now

Lawyers for Albertsons and Kroger will likely meet in the courtroom again — but unlike the recent federal trial in Oregon, they’ll be on opposing sides.

The day after judges in Oregon and Washington blocked a $24.6 billion merger agreement between the two grocery chains, Albertsons sued Kroger for breach of merger, claiming Kroger officials didn’t do enough to appease regulators. Kroger denies Albertsons’ assertions.

The two could fight it out in a Delaware courtroom, where the suit was filed — but implications of the merger breakdown and subsequent legal battle are likely to be felt in the Pacific Northwest.

Albertsons is headquartered in Boise, Idaho, but operates more than 20 stores in Oregon. Albertsons is also the parent company for Safeway, which has nearly 100 stores across the state. Kroger is headquartered in Cincinnati and owns more than 50 Fred Meyer and QFC stores in Oregon.

“Albertsons is seeking billions of dollars in damages from Kroger to make Albertsons and its shareholders whole,” the company said in a written statement. “Albertsons’ shareholders have been denied the multi-billion-dollar premium that Kroger agreed to pay for Albertsons’ shares and have been subjected to a decrease in shareholder value on account of Albertsons’ inability to pursue other business opportunities as it sought approval for the transaction.”

Leaders from Albertsons and Kroger announced in October 2022 that they would pursue a merger. The two argued the combined company would be in a better position to compete against Walmart and other large food retailers.

Oregon judge blocks merger of Kroger and Albertsons

However, the Federal Trade Commission sued to halt the merger, saying it would hurt competition and raise prices. During a three-week hearing in Portland that ended in September, leaders from Albertsons said if the merger didn’t go through the company would have to lay off workers and close stores.

On Tuesday, judges in both Oregon and Washington sided with the FTC. Less than 24 hours later, Albertsons announced it was suing Kroger for failing to secure regulator approval.

“Kroger looks forward to responding to these baseless claims in court,” a Kroger spokesperson said in a written statement. “We went to extraordinary lengths to uphold the merger agreement throughout the entirety of the regulatory process and the facts will make that abundantly clear.”

On Wednesday, spokespeople for both Albertsons and Kroger declined to say if stores would be closing or if workers would be laid off in Oregon due to the failed merger.

Separately, on Dec. 6, Albertsons leaders notified Oregon officials that the company was closing its Roseburg store and laying off 87 employees. The store will close to the public in February.