Kroger/Albertsons merger would lead to Alaska store closures, reduced competition, higher prices
Under the proposed $25 billion corporate merger between the companies that own Fred Meyer and Safeway, 14 stores in Alaska would be sold to C&S Wholesale Grocers, a company that hasn’t been in the retail business in Alaska.
Kroger, which wants to acquire Albertsons, says it needs a merger to become larger and be better able to compete, so no one should expect that the 14 stores to be sold to the smaller company would be long for this world. Kroger has not identified the 14 stores.
If the merger goes through, there will be store closures in Alaska. No one knows how many.
C&S Wholesale Grocers, which is mainly in the wholesale business, would be taking over 413 stores across the country. Alaska would not be a company focus and those stores would not last long.
Similar questions about longevity exist about all the stores where Safeway and Carrs now offer some competition to Fred Meyer across Alaska. Those stores will not be around for the long run because the company will have a business incentive to consolidate.
Kroger says it would not close any stores “as a result of the merger.” Don’t take that to mean that all stores will remain open in the months and years after the merger.
As I wrote here in late 2022, the claim that the merger will lead to more choices, higher employee wages and lower costs for consumers is laughable for Alaskans.
Gov. Mike Dunleavy will no doubt mention food security in his annual State of the State speech and claim that he is doing all he can to help families.
But he appears to be unaware and unconcerned that the proposed merger would reduce competition, lead to higher prices and eliminate jobs in Alaska. Food security is something that Dunleavy likes to talk about, though he hasn’t done much about it, other than claiming to have created the imaginary Alaska Office of Food Security.
More than two dozen Alaska legislators signed onto a letter last fall protesting the takeover on the grounds that stores will close, competition will decrease and prices will increase.
Dunleavy and Attorney General Tregarrick Taylor should read the lawsuit filed by the State of Washington against the grocery companies, which identifies problems that will be worse in Alaska than in Washington. Here is the lawsuit.
"This merger of the two largest supermarket companies in Washington will severely limit vital competition that keeps grocery prices in check," Washington Attorney General Bob Ferguson said at a press conference.
In response, Kroger claimed the merger would lower prices, more choices for fresh food and higher wages.
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