Oregon federal judge temporarily blocks proposed Kroger-Albertsons merger

PORTLAND, Ore. (KOIN) — An Oregon federal judge has temporarily blocked the merger between two of the largest grocers in the U.S.: Kroger and Albertsons.

The merger was at the center of a three-week trial that started in Portland in August. U.S. District Court Judge Adrienne Nelson issued a preliminary injunction against it on Tuesday afternoon.

“Although defendants may choose to abandon the merger because of the preliminary injunction, this order in no way forces them to do so, and leaves open the possibility that they may pursue the merger at a later date should it be deemed lawful in the administrative proceedings,” Nelson wrote.

The Ohio-based Kroger operates 2,800 stores in 35 states, while the Idaho-based Albertsons operates 2,220 stores in 34 states. The companies first proposed the $24.7 billion acquisition in October 2022, arguing that it would help them compete with other large retailers like Amazon and Walmart.

In February of this year, Oregon was one of several states to join the Federal Trade Commission’s lawsuit that aimed to block the merger. The commission argued the act would reduce competition while increasing food costs for consumers.

A Kroger spokesperson later announced the potentially-merging companies’ plan to divest 579 stores to C&S Wholesale Grocers, including 186 locations in Oregon and Washington. Although the spokesperson stated C&S wouldn’t close any stores and workers would remain employed, other organizations and leaders — including Oregon Sen. Ron Wyden — continued to argue the acquisition would hinder workers and consumers alike.

The senator backed Judge Nelson’s opinion in a recently-issued statement.

"I'm glad the court has shelved this monster deal because in addition to raising grocery prices for shoppers already tiptoeing on an economic tightrope, it would have made it that much harder for Oregonians to find a pharmacy and for workers at both supermarket chains to seek fairer wages and better working conditions,” Wyden said, in part.

In a statement, several local unions with United Food and Commercial Workers' Stop the Merger coalition also urged Kroger and Albertsons to re-invest in their stores instead of going forward with the merger.

According to Nelson, the injunction is “pending the outcome of the administrative proceedings before the Federal Trade Commission.”