Kroger, Albertsons Divest 413 Stores Ahead of $24.6B Merger

In anticipation of their $24.6 billion merger, The Kroger Company and Albertsons Companies, Inc. have revealed plans to sell 413 store locations and several assets to satisfy U.S. regulatory requirements, ensuring the deal progresses smoothly.

Kroger and Albertsons, which operate almost 5,000 stores in 48 states in the U.S., including Washington, D.C. and the District of Columbia, decided to put their stores up for sale to obtain clearance from the U.S. regulators, and their merger plans could proceed. This step is a measure that will see to it and convince the regulators that the retail giants will not infringe on any antitrust laws in the country.

According to Fox Business, Kroger and Albertsons agreed to a divestiture plan that will transfer ownership of their 413 stores to C&S Wholesale Grocers. This scheme was hatched as the companies aimed to obtain the required clearance from the U.S. regulatory as soon as possible.

Moreover, Kroger will also unload its private label brands, including the QFC and Mariano's, while Albertsons is divesting Debi Lilly Design, Carrs, ReadyMeals, Primo Taglio, Waterfront Bistro, and Open Nature. It was also mentioned that Keene, a New Hampshire-based wholesale company, is also buying eight distribution centers and two offices belonging to the grocery chain brands.

"Following the announcement of our proposed merger with Albertsons Cos., we embarked on a robust and thoughtful process to identify a well-capitalized buyer who will operate as a fierce competitor and ensure divested stores and their associates will continue serving their communities in the ways they do today," The Kroger Co. chairman and chief executive officer, Rodney McMullen, said in a press release.

He added, "C&S is led by an experienced management team with an extensive background in food retail and distribution and has the financial strength to continue investing in associates and the business for the long run and importantly in our agreement, C&S commits to honoring all collective bargaining agreements which include industry-leading benefits, retaining frontline associates and further investing for growth."

Photo by: Kroger Press Release