Albertsons Asked to Delay Big Dividend

Oct. 28, 2022
Six attorneys general say it’s inappropriate in light of Albertsons’ intention to be acquired by Kroger.

Six state attorneys general have signed a letter to Kroger and Albertsons, expressing concern about an impending acquisition and asking Albertsons to hold off on a large payment to shareholders.

The attorneys general of Illinois, Arizona, California, Idaho. Washington state and the District of Columbia addressed a letter Oct. 26 to the CEOs of Kroger and Albertsons, regarding Kroger’s plan to acquire Albertsons in a $24.6 billion deal. They want to ensure that the deal “does not result in higher prices for consumers, suppressed wages for workers, or other anticompetitive effects.”

Their specific concern is a “special dividend” of $4 billion that Albertsons announced on Oct. 18 it would pay to shareholders on Nov. 7. The letter claims that the payment would be about one-third of Albertsons’ market capitalization, and claims that “paying a dividend of this size will hamper its ability to meaningfully compete with Kroger” before the deal.

Political opposition to the deal is heating up, with U.S. Sens. Elizabeth Warren (D-Mass.) and Bernie Sanders (I-Vt.) writing to urge the Federal Trade Commission to disallow it. Members of a Senate subcommittee have already declared an intention to hold hearings on the transaction.

About the Author

Pan Demetrakakes | Senior Editor

Pan has written about the food and beverage industry for more than 25 years. His areas of coverage have included formulations, processing, packaging, marketing and retailing. Pan worked for Food Processing Magazine for six years in the 1990s, where he was operations editor (his current role), touring dozens of food plants of every description. He has also worked for Packaging and Food & Beverage Packaging magazines, the latter as chief editor, during which he won three ASBPE awards. He is a graduate of Stanford University with a BA in communications.

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