The Future of Albertsons- assuming the Kroger merger doesn't happen

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retailfanmitchell019
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The Future of Albertsons- assuming the Kroger merger doesn't happen

Post by retailfanmitchell019 »

Lately, both Kroger and Albertsons have been very silent about their proposed merger, since the state of Washington's AG sued to stop Albertsons from paying a dividend payment of $4 billion, then the Senate hearing, and then the dispute with Express Scripts. As if that weren't enough, the FTC has actively studied the merger, doing a "second request". This second request extends the initial 30-day waiting period for an antitrust review following the filing of a merger transaction with the FTC and Department of Justice antitrust division under the Hart-Scott-Rodino Antitrust Improvements Act (HSR).
Kroger's response:
"Kroger looks forward to realizing the compelling benefits this merger will offer, including enhancing competition, lowering prices for customers, improving access to fresh food, creating opportunities to continue investing in our associates and securing the long-term future of union jobs. We will continue to work cooperatively with the Federal Trade Commission as it conducts its review of the merger, including developing a thoughtful divestiture plan. Kroger continues to expect to complete the merger in early 2024."
"Enhancing competition" :lol:

I think the merger only has a 20-25% chance of being successfully completed.

This is how I think Albertsons should be carved up, assuming the merger doesn't happen:

Texas: United goes to an investment firm. Albertsons Market would be merged back into the Southwest Division.
As for the D/FW stores, those could go to Brookshire's. I expect Randalls to be parted out in both Austin and Houston.

Safeway East: UNFI looks to be expanding again, so some of those Safeways could go into Shoppers Food. Otherwise, Kroger could buy some of those to put into Harris Teeter.

Shaw's/Star Market: Those stores would be parted out to Big Y, ShopRite, and Price Chopper, the latter having stores in the far out Boston suburbs. Market Basket is out of the question as they prefer to build their own stores.

Acme: Price Chopper, Big Y, or ShopRite operators could buy the Acme stores in the NYC suburbs. The Philly area Acme stores stay with Albertsons.

Denver: I expect the Safeway stores in the Rockies (along with Albertsons/Safeway in WY/SD) to be merged into Intermountain.
Safeway stores along the Front Range, from Fort Collins to Pueblo, should be sold to AWG, along with their Denver warehouse, which could be used form an AWG "western region", which would supply AWG members already in CO/WY/western SD/western NE/western KS. Those Safeway stores would take the Price Chopper name. The Safeway stores in eastern CO/western NE should be sold to Hy-Vee for their Dollar Fresh format.


The core parts of Albertsons (NorCal, PNW, Intermountain, Southwest, SoCal, Jewel, and the core of ACME, around Philadelphia) stay put. Albertsons would be a more streamlined company.
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