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WCPO: Kroger Co. approaching finish line on acquisition of Albertsons grocery chain

UC Law Professor Felix Chang, an expert in antitrust law, discusses the pending acquistion of the Albertsons grocery chain by Kroger Co. with WCPO-TV.

The clock is ticking as the Cincinnati-based Kroger Co. moves closer to its mammoth acquisition of grocery store chain Albertsons Cos.

Kroger has taken a big step in the process by certifying to the Federal Trade Commission on Nov. 15 that its $24.6 billion deal with the Albertsons grocery chain substantially complies with antitrust rules. By law, there is a 30-day timeline for the FTC to accept the deal or sue to block it.

WCPO aired interviews with FTC Chair Lina Khan along with supporters and critics of the proposed acquisition, which would result in two of the nation’s largest supermarket chains merging into a 4,500-store giant.

Krogers says a bigger company will reduce prices and boost wages for union workers allowing it to best larger rivals such as Walmart and Amazon. Critics say it will give Kroger and Albertsons too much control of the grocery market, which could mean higher prices for consumers and lower pay for grocery employees.

UC Law Professor Felix Chang, an expert in antitrust law, also weighed in on the topic. He regularly teaches antitrust, business associations, securities regulation, and wills and estates.

UC Law professor Felix Chang

UC Law Professor Felix Chang. Photo by Andrew Higley/UC Marketing + Brand.

“I think regulators are really interested in … the effect of concentration in certain markets, particularly upon labor and upon sellers,” Chang told WCPO. “Grocery stores are really, really, important purchasers for manufacturers, for farmers. And the larger the purchaser, the more market power it has.”

Chang, co-director of the Corporate Law Center at UC Law, told WCPO that the FTC has signaled its concerns about market concentration in a set of proposed merger guidelines published in July.

Guideline 8 says mergers “should not further a trend toward concentration." Guideline 5 says mergers “should not substantially lessen competition by creating a firm that controls products or services that its rivals use to compete.”

While the guidelines are not law and yet to be finalized, they could signal a willingness by the FTC to challenge the Kroger-Albertsons deal with new legal arguments.

“It’ll be a really interesting test case if it really is going to be challenged in the court,” Chang told WCPO.

Listen to the WCPO story online.

Learn more about UC Law Professor Felix Chang.