WASHINGTON, D.C. – Attorney General Mark Brnovich today announced he joined a bipartisan group of state attorneys general in calling on grocery chain Albertsons – which owns Safeway – to hold off on paying out nearly $4 billion to its shareholders until the state attorneys general can complete their review of Kroger and Albertsons' proposed merger.
On October 14, when Albertsons and Kroger announced their proposed merger, Albertsons also announced a “special dividend” to go out to shareholders on November 7 at $6.85 per share – totaling nearly $4 billion, which is more than two years of profits for the company. The “special dividend” risks significantly limiting Albertsons’ ability to operate and properly compete with Kroger, which could seriously impact consumers, workers, and the grocery industry at-large before regulators even have the chance to review the deal.
With inflation at historically high levels, consumers’ grocery prices rose 12.2% from last summer to this summer, which is the biggest jump in more than 40 years. General Brnovich is looking into whether additional consolidation in the grocery industry could lead to even higher food prices at a time when many families across the country are struggling to afford to put food on the table. He is also examining if the special dividend or the merger could reduce good, high-paying jobs, and hurt wages and benefits for workers. Meanwhile, the private equity investors who control the grocery chains will have gained profits nine times larger than their original investments in 2006, if the merger is approved.
Kroger and Albertsons have more than 710,000 employees in nearly 5,000 stores across 48 states and D.C., reinforcing that all corners of the country, especially Arizona, would feel the effects of the proposed merger.
A copy of the coalition’s letter to Albertsons and Kroger.