Kroger-Albertsons merger blocked by federal judge: CEI analysis

Today, a federal judge sided with the Federal Trade Commission in its lawsuit to stop a merger between Kroger and Albertsons. CEI experts weigh in on how this decision will affect consumers and competition.

CEI Director of the Center for Technology & Innovation Jessica Melugin:

“Ironically, this decision decreases the amount of beneficial competition in the grocery sector by hobbling traditional retailer’s ability to compete with big box and online stores. Sadly, and literally, consumers will pay the price for activist FTC interventionism like this.”

CEI Senior Economist Ryan Young:

“This is not the end of the case. This verdict is appealable, as are the pending verdicts in two separate cases brought by Colorado and Washington State.

“The grocery market is changing. Kroger and Albertsons’s merger is their attempt to adapt. While Kroger and Albertsons might be two of the largest traditional grocery store chains, big-box stores such as Walmart and Costco both sell more groceries.

“Online ordering is also a growing business, and both traditional retailers and big box stores are making massive investments to be able to compete with Amazon and other online-centric grocery sellers. Mergers are one way for older competitors to keep up with what consumers demand of them. This merger is evidence that dynamism and competition are alive and well, not that it is dying.”

Read more from CEI:

• The FTC’s Challenge to the Kroger/Albertsons Merger
• FTC suit to stop Kroger-Albertsons Merger would harm consumers
• SNAP Back to Reality: Why the FTC Needs a Broader View of the Kroger-Albertsons Case