Two months after the Federal Trade Commission (FTC) completed a review of Kroger and Albertsons’ proposed supermarket mega-merger and filed a lawsuit to block the deal, the grocery chains have added more store locations and assets to an updated version of their definitive divestiture agreement with C&S Wholesalers. The new agreement is valued at approximately $2.9 billion, according to a press release, and includes an additional 166 Kroger and Albertsons stores, bringing the total planned store divestments in relation to the merger up to 579. The majority of divested stores are coming from the West Coast with both retailers selling a combined 124 in Washington state. However, Albertsons will contribute the majority of the stores through the new plan, including 101 in Arizona, 91 in Colorado, 63 in California and 62 in Oregon. A number of Albertsons banners will also be sold in Texas, Louisiana, Nevada, Illinois, Arkansas, Idaho, New Mexico, Montana, Utah and Wyoming. Kroger will divest stores in Oregon and Illinois, as well as nine Harris Teeter stores between Maryland, Virginia, Delaware and Washington, D.C. Per terms of the deal, all divested stores, regardless of the banner, will be sold by Kroger to C&S. Additionally, fuel centers and pharmacies at divested locations will remain part of those stores and continue to operate. Alongside the stores, the retailers have also added store-support resources including increasing distribution capacity for C&S with a combination of access to larger facilities, expanded transition services agreements as well as the addition of one new dairy facility. Corporate and office infrastructure are also part of the package. Lastly, the updated plan will give C&S access to two additional private brands: Signature and O Organics. The deal has maintained the original agreement that Kroger and Albertsons will divest their Debi Lilly Design, Primo Taglio, Open Nature, ReadyMeals and Waterfront Bistro brands to C&S. "Importantly, the updated divestiture plan continues to ensure no stores will close as a result of the merger and that all frontline associates will remain employed, all existing collective bargaining agreements will continue, and associates will continue to receive industry-leading health care and pension benefits alongside bargained-for wages,” said Rodney McMullen, Kroger's chairman and CEO. Read the full story on Nosh for all of the details about the new divestiture agreement and what this means for the merger’s path forward. |