CINCINNATI - The Kroger Co . (NYSE: NYSE:KR) has issued a statement today challenging the Federal Trade Commission's (FTC) opposition to its proposed merger with Albertsons (NYSE:ACI) Companies, arguing that the move would benefit consumers and workers, contrary to the FTC's claims.
Kroger asserts that its business model, which involves cutting costs to lower consumer prices, has consistently reduced prices since 2003 and that this approach would be applied to Albertsons post-merger.
Kroger contends that the FTC's stance could lead to higher food prices and fewer grocery stores, strengthening the position of larger, non-unionized competitors. The company emphasizes its track record of investing in price reductions and store improvements following past mergers, citing over $225 million invested in price cuts after its mergers with Harris Teeter and Roundy's.
The merger plan includes a commitment to no store, distribution center, or manufacturing facility closures, including those divested to C&S Wholesale Grocers. Kroger also pledges to invest $500 million to reduce prices from day one post-merger, with an additional $1.3 billion earmarked for Albertsons store improvements.
The combined company aims to increase the number of local products in stores by 10% and invest $1 billion in raising wages and benefits for employees.
Kroger further outlines its social commitments, including a $1.9 billion investment in wages and benefits since 2018 and a promise to donate 10 billion meals by 2030 to combat hunger. The divestiture plan with C&S Wholesale Grocers is designed to fulfill Kroger's merger commitments, maintain collective bargaining agreements, and extend a competitor's reach into new geographies.
The company looks forward to defending the merger in court, asserting that it will lead to lower prices, more choices, and increased union jobs. This statement is based on a press release by The Kroger Co. and includes forward-looking statements subject to various uncertainties and risk factors that could impact the actual results of the proposed transaction.
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