Albertsons suing Kroger for $8B over failed merger
Albertsons Cos. is accusing The Kroger Co. of breaching a 2022 agreement that would have seen Kroger acquire Albertsons.
In an Oct. 12 legal filing in Delaware Chancery Court, Albertsons claims Kroger owes it between $5.43 billion and $6.88 billion in lost premium damages resulting from a $24.6 billion merger agreement between the two companies which Kroger terminated in December 2024. Albertsons also says it is owed a tax gross-up of between $1.4 billion and $1.7 billion, as well as a $600 million termination fee and other related losses including loss of shareholder value for a total of more than $8 billion.
The court is scheduled to begin hearing the lawsuit Monday, Oct. 19. It is the latest development in a long string of events that began in October 2022 when Kroger agreed to buy Albertsons Companies for $34.10 a share in a deal valued at $24.6 billion. The deal included approximately $4.7 billion of Albertsons’ net debt.
[READ MORE: Kroger in blockbuster deal to buy Albertsons]
At the time, Kroger was the second-largest grocer in the U.S. and Albertsons was the fourth-largest (they are now the third- and fifth-largest, respectively).
In September 2023, the two supermarket giants entered into an agreement to sell 413 stores (locations at end of article) and eight distribution centers across 17 states to C&S Wholesale Grocers LLC for $1.9 billion in cash as part of the plan to gain regulatory approval.
However, in early 2024, the proposed merger was delayed from its original expected March 2024 completion date due to ongoing discussions with regulators from the Federal Trade Commission (FTC), which then sued to block the merger, saying it would result in higher prices for shoppers and lower wages for workers.
A bipartisan group of nine attorneys general joined the FTC’s federal court complaint, which was also supported by workers’ unions for employees of both companies.
After more legal wrangling and rulings from federal and county courts in Oregon and Washington that blocked the merger in December 2024, Albertsons initially filed breach-of-contract claims in Delaware Chancery Court, claiming that Kroger failed to exercise its “best efforts” to secure regulatory approval of the deal.
“Kroger willfully breached the Merger Agreement in several key ways, including by repeatedly refusing to divest assets necessary for antitrust approval, ignoring regulators’ feedback, rejecting stronger divestiture buyers and failing to cooperate with Albertsons,” the company stated in a press release at the time.
Kroger publicly refuted those allegations and in March 2025 filed a counterclaim, since dropped, accusing Albertsons and C&S Grocers of secretly conspiring to undermine its efforts.
Albertsons’ latest filing essentially repeats its previous breach-of-merger allegations against Kroger, which continues to deny them and accuse Albertsons of its own malfeasance. Kroger is also currently pursuing its July agreement to acquire regional grocer Giant Eagle Inc., which operates roughly 200 stores, for $1.65 billion in cash and liabilities.
