Report: Kroger and Albertsons to sell 400 stores for $2B to C&S Wholesale as part of merger

UPDATED: Supermarket operators Kroger and Albertsons plan to sell off more than 400 stores for nearly $2 billion in connection with their planned $25 billion merger, according to a report by Reuters citing unnamed sources.

The divestiture to New Hampshire-based C&S Wholesale Grocers is part of a move to mollify antitrust regulars at the Federal Trade Commission. The stores that Kroger and Albertsons plan to shed are primarily in the Pacific Northwest and the Mountain states, along with some in California, Texas, Illinois, and the East Coast, the outlet reported.

Previous reporting:

Kroger and Albertsons supermarkets are in talks with New Hampshire-based C&S Wholesale Grocers to sell potentially hundreds of stores as part of their proposed $25 billion merger, according to a report by Bloomberg News.

Unnamed sources speaking to the outlet said a deal could be announced as early as this week, though financial terms were unclear. “Most or all” of the stores that a combined Kroger-Albertsons plans to divest to mollify antitrust regulators would be sold to C.S. Wholesale, the report said.

Kroger and Albertsons outlined the potential sale of 100 to 375 stores when they first announced their proposal. They have since disclosed they would cap divested stores at 650 locations.

Kroger and Albertsons declined comment Wednesday. Officials with C&S did not respond to emails seeking comment on the potential deal.

Though C&S Wholesale is a more than $30 billion company supplying more than 7,500 supermarkets across the country, the Keene-based private company appears to operate only a few dozen supermarkets of its own: 11 Grand Union stores in New York and Vermont as well as an unspecified number of Piggly Wiggly stores in Wisconsin and the Southeast.

Announced last fall, the proposed Kroger-Albertsons merger would be one of the largest retail takeovers in history. The deal would give Cincinnati-based Kroger almost 5,000 stores and more than 700,000 workers before an undetermined number of store divestitures. The two companies have vowed not to close stores or layoff workers, but the unions and other critics are skeptical.

Consumer and union groups have opposed the deal, claiming it would hurt competition and ultimately raise prices and harm workers. Regulators have declined to comment as they decide whether to block it. Kroger executives have vowed to fight for the deal in court.

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