Albertsons has terminated its pending $25 billion merger agreement with Kroger following decisions by courts in Oregon and Washington State to block the deal. In addition, Albertsons is suing Kroger for billions of dollars, claiming Kroger caused the merger to be blocked by refusing to offer an adequate divestiture package and repeatedly ignoring regulators’ concerns.
The Albertsons lawsuit claims willful breach of contract and breach of the covenant of good faith and fair dealing due to Kroger’s failure to exercise “best efforts” and to take “any and all actions” to secure regulatory approval. The merger, which had sought to combine the country’s two largest grocers, was announced in 2022.
Kroger called the lawsuit “baseless and without merit,” stating that it went to extraordinary lengths to uphold the merger agreement.
According to Albertsons, the termination of the merger entitles the company to an immediate $600 million termination fee. The additional money Albertsons is seeking in the lawsuit is for additional restitution for “multiple years and hundreds of millions of dollars devoted to obtaining approval for the merger, along with the extended period of unnecessary limbo Albertsons endured as a result of Kroger’s actions.”
