U.S. Senator Objects To Kroger's Giant Eagle Purchase

PITTSBURGH, PA — A United States senator is objecting to Kroger's plan to acquire Cranberry-based Giant Eagle in a $1.65 billion transaction.

Elizabeth Warren, a Massachusetts Democrat, has contacted the Federal Trade Commission and the U.S. Department of Justice complaining about the proposed acquisition. She also is objecting to food distributor Sysco’s acquisition of Jetro Restaurant Depot and food manufacturer McCormick & Company's acquisition of Unilever. (Unilever) food business.

“In isolation, each of these mergers would raise competition concerns; together, they appear to reveal a growing consolidation trend, driven by weak antitrust enforcement under President Trump, that raises costs and hurts consumers, restaurants, and small businesses,” Warren wrote in a letter jointly addressed to both agencies.

Pending federal approval, Kroger will purchase Giant Eagle, a family owned grocery conglomerates with nearly 200 locations in Western Pennsylvania, northern Ohio, West Virginia, Maryland and and Indiana. Giant Eagle will operate independently as a Kroger subsidiary if the deal is completed.

Warrens said her key objection to the purchase is that "there is considerable overlap between Kroger and Giant Eagle's respective territories, generating serious concern that the acquisition will lead to reduced competition in local markets.

"As one antitrust expert pointed out, 'It's not uncommon in Ohio to find a Kroger or Giant Eagle on the same street. For many families, they're the two stores they choose between each week. Combining them would mean fewer choices, less competition and inevitably higher grocery prices for communities.'"

Warren also noted that Kroger's acquisition of Giant Eagle by Kroger threatens to further consolidate a grocery market that is already heavily concentrated. Just four companies, Walmart, Kroger, Costco, and Albertsons, control approximately 69 percent of the U.S. grocery retail market.

"Further consolidation among major grocery chains will reduce consumer choice by limiting the number of competing stores available to shoppers while weakening incentives to offer lower prices, higher-quality products, and better
service," Warren wrote.

"It will also disrupt and endanger the livelihoods of thousands of grocery workers, who could face store closures, layoffs, reduced hours, and fewer employment opportunities as Kroger
eliminates overlapping operations and faces less competition for their labor."