American supermarket chain Kroger has submitted its formal response and counterclaims to the lawsuit initiated by rival chain Albertsons over their terminated merger deal.
The legal action, filed in the Delaware Court of Chancery, is rooted in the fallout from a proposed $25bn merger between the two entities, ultimately called off in December 2024 after facing legal hurdles.
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Albertsons, which ended the merger following a court injunction, subsequently accused Kroger of contract violations that purportedly caused the collapse of the agreement.
In its counterclaim, Kroger has accused Albertsons of secretly collaborating with C&S Wholesale Grocers, the designated buyer for divestitures, to devise an independent regulatory strategy.
Kroger claims that this move sabotaged its own efforts to navigate antitrust concerns successfully.
“Albertsons was engaging in a secret and misguided campaign, together with C&S Wholesale Grocers, the divestiture buyer, to pursue its own regulatory strategy, which ultimately undermined Kroger’s efforts,” according to a statement from Kroger.
The alleged irregularities by Albertsons were revealed during scrutiny by government officials in antitrust proceedings by Susan Morris, who had been recently appointed as Albertsons’s CEO designate.
“As a result of its misconduct, Albertsons is not entitled to the $600m termination fee under the terms of the parties’ merger agreement, nor is Albertsons entitled to the other damages it seeks,” Kroger stated.
In defence of its actions, Albertsons maintains that it was fully committed to the merger’s success from the beginning and accuses Kroger of failing to meet its contractual commitments.
An emailed statement from Albertsons to Reuters read: “Kroger’s weak claims are a deliberate tactic to distract from its own ongoing executive leadership issues [and] blatant and recurring failures to carry out its contractual obligations under the merger agreement, and avoid paying the damages it owes.”
The dissolution of the merger in December 2024 ended a two-year pursuit of unification.
The merger was halted by regulators over concerns that it would stifle competition, potentially lead to higher consumer prices, and weaken bargaining power for unionised employees.
In March 2025, Kroger announced the resignation of its chairman and CEO Rodney McMullen following an investigation into his personal conduct.
At the same time, Albertsons announced that CEO Vivek Sankaran would retire and be succeeded by internal appointee Susan Morris.
