Skip to main content

Market Overview

Kroger Stock Up After Judge Blocks Albertsons Deal: What You Need To Know

Share:
Kroger Stock Up After Judge Blocks Albertsons Deal: What You Need To Know

Kroger Co (NYSE:KR) shares are trading higher Tuesday afternoon following reports that a U.S. judge blocked the company’s proposed merger with Albertsons Companies Inc (NYSE:ACI).

What Happened: U.S. District Judge Adrienne Nelson ruled in favor of the U.S. Federal Trade Commission (FTC) in a decision filed in Oregon federal court on Tuesday, according to Bloomberg. Nelson found that the merger deal would impact competition in the grocery space.

The FTC had argued that the proposed deal violated antitrust laws. The companies submitted a plan to the FTC that included the divestiture of hundreds of stores to C&S Wholesale Grocers in order to maintain appropriate competition in the space. Nelson on Tuesday found that the divestiture plans wouldn’t do enough to replace competition that would be impacted as a result of the deal.

From Last Week: AI Revolutionizes Black Friday Shopping As Online Sales Reach New Heights

Kroger would have owned approximately 5,000 stores across the U.S. if the deal was approved. Kroger and Albertsons argued at trial that the companies needed to merge to keep pace with global conglomerates like Walmart and Amazon, per Reuters. On the other hand, grocery workers’ unions criticized the merger, arguing it was likely to result in job losses.

The report indicates that the ruling likely marks the end of the deal. Attorneys for both companies reportedly said the deal would most likely be squashed if the judge ruled in favor of the FTC.

Kroger shares jumped more than 5% on the news, while Albertsons shares fell close to 4%.

KR Price Action: Kroger shares are up about 32% year-to-date. The stock closed Tuesday up 5.14% at $60.73, according to data from Benzinga Pro.

Read Next:

Photo: Shutterstock.

 

Related Articles (KR)

View Comments and Join the Discussion!

Posted-In: Grocery stores why it's movingM&A News Legal Movers

Don't Miss Any Updates!
News Directly in Your Inbox
Subscribe to:
Benzinga Premarket Activity
Get pre-market outlook, mid-day update and after-market roundup emails in your inbox.
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Fintech Focus
A daily collection of all things fintech, interesting developments and market updates.
SPAC
Everything you need to know about the latest SPAC news.
Thank You

Thank you for subscribing! If you have any questions feel free to call us at 1-877-440-ZING or email us at vipaccounts@benzinga.com