- Friday, Kroger Co KR agreed to purchase Albertson’s Companies Inc ACI for $34.10 per share for an enterprise value of approximately $24.6 billion build a national footprint.
- However, the US Federal Trade Commission (FTC) could challenge the deal in the face of increased antitrust scrutiny by the Biden administration.
- “There is a significant risk of a challenge,” said Andre Barlow of the law firm Doyle Barlow and Mazard PLLC. “This is the kind of deal the FTC wants to discourage.”
- To address the so-called concerns, the companies plan to divest some businesses, according to Reuters reportedand Albertsons is poised to spin off a standalone entity to its shareholders immediately prior to closing of the transaction, which is expected in early 2024. The newly listed company is estimated to have up to 375 stores.
- “We have a clear path to gain regulatory approval for divestitures,” the company’s executives assured investors on a conference call, adding that it’s too early to narrow down which markets the restructuring would take place in.
- Barlow said the FTC still had questions about who would operate the stores and whether they would have enough assets and purchasing power to compete effectively.
- Still, some analysts were optimistic that the plan to sell businesses would be enough.
- Kroger said it expects to reinvest about half a billion dollars in cost savings from deal synergies to drive down prices. In addition, $1.3 billion will be invested in Albertsons.
- “The merger will strengthen our position as a more compelling alternative to larger and non-unionized competitors,” the report quoted Rodney McMullen, Kroger’s chief executive officer.
- Kroger will have to pay Albertsons $600 million if the deal goes through.
- Price promotion: KR shares are up 0.79% to $43.50 during the premarket session on last Check Monday.
- Photo via company
© 2022 Benzinga.de. Benzinga does not provide investment advice. All rights…
Read full story here https://www.benzinga.com/news/large-cap/22/10/29282312/krogeralbertsons-25b-merger-might-face-antitrust-challenge
More to explorer
How Backspace Marketing Elevates SaaS Success with Strategic Off-Site SEO
December 23, 2024
In the dynamic world of Software as a Service (SaaS), achieving visibility and authority requires more than just technical innovation. Companies need
How to Navigate the Claims Process: A Guide for Injury Victims
December 20, 2024
Injuries strike when least expected. One moment, you’re going about your day, and the next, you’re dealing with the chaos of physical
Common Mistakes to Avoid After Suffering a Personal Injury
December 20, 2024
Suffering a personal injury can be a traumatic and overwhelming experience. Whether it’s the result of a car accident, a workplace mishap,
