Albertsons\u00a0on Wednesday formally terminated its proposed $25 billion merger with\u00a0Kroger\u00a0and filed a lawsuit against its supermarket competitor, saying Kroger violated its contract and didn\u2019t follow through on commitments to help get the deal approved.<\/p>\n
It comes a day\u00a0after a judge blocked\u00a0the planned tie-up.<\/p>\n
In a news release, Albertsons said Kroger broke its merger agreement \u201cby repeatedly refusing to divest assets necessary for antitrust approval, ignoring regulators\u2019 feedback, rejecting stronger divestiture buyers and failing to cooperate with Albertsons.\u201d<\/p>\n
\u201cKroger\u2019s self-serving conduct, taken at the expense of Albertsons and the agreed transaction, has harmed Albertsons\u2019 shareholders, associates and consumers,\u201d Albertsons\u2019 General Counsel and Chief Policy Officer Tom Moriarty said in a statement. \u201cWe are disappointed that the opportunity to realize the significant benefits of the merger has been lost on account of Kroger\u2019s willfully deficient approach to securing regulatory clearance.\u201d<\/p>\n
In a statement, Kroger called the allegations in the lawsuit \u201cbaseless and without merit.\u201d<\/p>\n
\u201cThis is clearly an attempt to deflect responsibility following Kroger\u2019s written notification of Albertsons\u2019 multiple breaches of the agreement, and to seek payment of the merger\u2019s break fee, to which they are not entitled,\u201d the company\u2019s statement said.<\/p>\n
About two years ago, Kroger\u00a0announced plans to buy Albertsons\u00a0and combine forces to fend off\u00a0Walmart,\u00a0Amazon\u00a0and\u00a0Costco. The deal would have put nearly 40 supermarket chains, including Kroger\u2019s Fred Meyer and Albertsons\u2019 Safeway under a single company.<\/p>\n
The lawsuit Wednesday amounts to something of a corporate divorce battle.<\/p>\n
The companies are at odds about who should pay for the legal fees associated with the merger and who, if anyone, is responsible for paying a breakup fee.<\/p>\n
Albertsons said in its news release that it is owed both a $600 million termination fee and \u201crelief reflecting the multiple years and hundreds of millions of dollars it devoted to obtaining approval for the merger, along with the extended period of unnecessary limbo Albertsons endured as a result of Kroger\u2019s actions.\u201d<\/p>\n
Kroger, on the other hand, pushed back against payments to Albertsons in its statement and said it \u201clooks forward to responding to these baseless claims in court.\u201d<\/p>\n
Shares of Albertsons and Kroger were up about 0.5% and 1%, respectively, in early trading Wednesday.<\/p>\n<\/p>\n
Albertsons\u00a0on Wednesday formally terminated its proposed $25 billion merger with\u00a0Kroger\u00a0and filed a lawsuit against its supermarket competitor, saying Kroger violated its contract and didn\u2019t follow through on commitments to help get the deal approved. It comes a day\u00a0after a judge blocked\u00a0the planned tie-up. In a news release, Albertsons said Kroger broke its merger agreement \u201cby […]<\/p>\n","protected":false},"author":0,"featured_media":13141,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-13140","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business"],"_links":{"self":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/13140","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/comments?post=13140"}],"version-history":[{"count":0,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/posts\/13140\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media\/13141"}],"wp:attachment":[{"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/media?parent=13140"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/categories?post=13140"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstriumphs.com\/index.php\/wp-json\/wp\/v2\/tags?post=13140"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}