Attorneys for the state and for the Kroger and Albertsons supermarket chains wrapped up a trial Thursday over the companies’ proposed $24.6 billion merger by disparaging each other’s expert witnesses and accusing the other of pushing an agenda that will harm Colorado shoppers and workers.
Closing arguments capped a trial that started Oct. 1 and is the third one seeking to block the merger of the grocery giants on grounds that it would drive up prices, reduce competition and harm customers, workers and the stores’ local suppliers. The Federal Trade Commission and attorneys general for Colorado and Washington State filed lawsuits saying the merger would violate federal and state antitrust laws.
Denver District Judge Andrew J. Luxen will issue a ruling in the case, though on Thursday there was no time frame for that decision.
Colorado Attorney General Phil Weiser filed the lawsuit in February to block the merger after holding 19 town halls across the state to hear from the public. He has said people were overwhelmingly opposed to the consolidation.
But Matt Wolf, the attorney representing Kroger, accused the state of trying to prevent his client from bringing lower prices to Colorado shoppers and higher pay to workers. Kroger has pledged to spend $1 billion a year to increase wages and benefits and $1 billion a year to lower prices for customers.
“The antitrust laws were written to encourage, not obstruct, pro-consumer deals like the one before the court,” Wolf said. “While Walmart, Costco and Amazon might be pleased with the state’s efforts today, grocery shoppers will pay more and get less if the state has its way.”
Kroger CEO Rodney McMullen and Albertsons CEO Vivek Sankaran testified earlier this month that combining their companies is the best way for them to compete against Walmart, the nation’s leading grocer in terms of sales, and other growing chains. Otherwise, Sankaran said Albertsons might have to lay off employees and exit some markets to remain economically viable.
But attorneys for the state argued that the merger, which would be the largest supermarket consolidation in U.S. history, warned of store closures, job losses and higher prices if the merger goes through. Kroger, which operates King Soopers and City Market stores in Colorado, and Albertsons Cos., which owns Safeway, compete head-to-head and together account for at least 50% of all the grocery sales in Colorado, according to the attorney general’s office.
A plan to sell 579 of the companies’ stores to try to allay fears about the loss of competition in the marketplace won’t work because the buyer, C&S Wholesale Grocers, doesn’t have the resources or experience to compete with Kroger after the merger, state attorney Arthur Biller said. C&S is a grocery distributor with few retail stores and has sold many of the stores it has acquired in the past, seeing the sales as good for its distribution business, he added.
“This makes C&S not only a smaller competitor than Albertsons, but a worse competitor,” Biller said.
In Colorado, the proposed divestiture would spin off 91 of stores owned by …read more
Source:: The Denver Post – Business
