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Grocery store chains Kroger and Albertsons announced on Monday, April 22, that they would be selling 166 locations to C&S Wholesale Grocers. This decision comes as the companies continue to seek authorities' approval for their proposed $25 billion merger.

Both businesses have been trying to sell shops to appease officials who are worried that the merger would raise prices, cause stores to close, and result in job losses.

C&S to Acquire 579 Stores From Kroger and Albertson

Up from the prior payment of $1.9 billion, C&S will now pay Kroger around $2.9 billion in cash for the stores under the revised deal.

Together with the 166 more locations, Kroger and Albertsons are now selling C&S a total of 579 stores and granting it access to the private label brands of O Organics and Albertsons Signature.

In October 2022, Kroger announced that it was acquiring Albertsons. Earlier this year, eight states and the United States Federal Trade Commission (FTC) filed a lawsuit to halt the agreement, claiming that it would lead to a spike in food costs for millions of Americans.

The FTC's request for a preliminary injunction to prevent the acquisition will be heard in August by an Oregon district court, Reuters reported. If pushed through, the deal would make Kroger the second-largest US supermarket retailer after Walmart.

Concerns Arise Among Union Members Regarding the Potential Sale of Store Real Estate

Meanwhile, union members are concerned that C&S may try to sell off store real estate, according to Tom Geiger of UFCW 3000. The group represents Kroger and Albertsons workers in Washington, Oregon, and Idaho.

Reuters reported that union members are worried this might happen if both companies fail to provide the right tech infrastructure, customer loyalty, or manufacturing capabilities to C&S.

In response, legal experts familiar with the sale and the divestment said that Kroger and Albertsons intend to provide C&S with an entity that it can manage well by boosting distribution capacity, which will lead to a density of local store networks that can sustain the retail giant's operations.