Grocery giant Kroger has been sued by rival Albertsons Cos., which terminated their merger agreement and claims the company breached contract terms, including failing to secure regulatory approval for their proposed deal.
Albertsons alleges that Kroger’s refusal to divest necessary assets, ignoring regulators’ feedback, and rejecting stronger buyers led to a failed merger. The company claims that these actions resulted in billions of dollars in damages, including termination fees and costs related to the failed merger process.
“We are taking this action to enforce and preserve Albertsons’ rights and protect our shareholders, associates, and consumers,” said Tom Moriarty, Albertsons’ general counsel and chief policy officer.
The lawsuit comes after regulators blocked the merger, citing concerns about antitrust issues. Kroger denies the allegations, stating that it has upheld its obligations throughout the regulatory process with “the highest degree of integrity and commitment.”
Kroger’s board is currently evaluating next steps in response to the baseless claims made by Albertsons. The termination of the merger agreement entitles Albertsons to a $600 million break fee and removes contractual constraints on pursuing other strategic opportunities.
The deal would have combined Kroger and Albertsons, delivering benefits for consumers, employees, and communities across the US.
Source: https://progressivegrocer.com/albertsons-terminates-merger-agreement-sues-kroger-breach-contract