Juneau’s three Democratic state lawmakers are among 24 in the 60-member Alaska State Legislature signing a letter to the chair of the Federal Trade Commission urging the federal government to block a proposed merger of the parent companies of Fred Meyer and Safeway, citing food price and workforce concerns.
The $24.6 billion planned merger between Kroger Co. (Fred Meyer’s parent) and Albertsons Companies Inc. (Safeway’s) announced in the fall of 2022 would, as of now, result in the sale of 14 of Alaska’s 35 Carrs and Safeway stores. It is not known which specific locations — including Juneau’s Safeway — would be affected.
[14 of 35 Carrs Safeway stores in Alaska to be sold as part of proposed Kroger-Albertsons merger]
“The merger creates an opportunity for monopolistic practices and an environment that lacks competition, as these companies are Alaska’s two major grocery store chains,” the letter sent Monday by the state lawmakers states. “Alaska already has some of the highest grocery prices in the nation, especially in our more secluded and rural areas, connected only by air or water. We cannot, in good conscience, support unnecessary cost increases that place barriers on Alaskans’ ability to put food on the table.”
The letter also asserts this merger will inevitably lead Kroger to lay off hundreds of Albertsons employees “most of whom are part of a well-established labor union that advocates for livable wages and benefits — whereas Kroger does not offer similar packages.”
The opposition in the letter comes after all three members of the state’s congressional delegation also formally expressed opposition to the merger within the past couple of months. Although only 40% of state lawmakers signed Monday’s letter, state Sen. Jesse Kiehl of Juneau said Wednesday the political and geographical diversity among those expressing opposition is significant.
“It’s bipartisan — you’ve got Senate majority, Senate minority, Rs and Ds,” he said, referring to party members. “It’s got significant statewide representation in Southeast, Southcentral, Fairbanks…I think it’s not the notion that the state Legislature is going to take this on as a regulatory thing. That’s what the federal agency is for. But I think it’s significant that a bunch of legislators really dug into this and got to this level of detail.”
A majority of the state signees are Democrats, although notable Republicans include Senate Majority Leader Cathy Giessel of Anchorage, Sen. Click Bishop of Fairbanks who chaired the Finance Committee’s Senate Labor and Workforce Development subcommittee, and Sen. Rob Myers of North Pole who is one three conservative senators not in the 17-member bipartisan majority coalition.
House Minority Leader Calvin Schrage, an Anchorage independent, is also among the signees. Senate President Gary Stevens, a Kodiak Republican, and House Speaker Cathy Tilton, a Wasilla Republican, did not sign the letter.
The letter also asserts the merger will result in Kroger laying off hundreds of Albertsons employees in Alaska, “most of whom are part of a well-established labor union that advocates for livable wages and benefits — whereas Kroger does not offer similar packages.”
Kroger and Albertsons, in corporate documents, have declared they plan to sell more than 400 stores nationwide to C&S Wholesale Grocers, which operates the Piggly Wiggly chain, and supplies more than 7,500 independent supermarkets, retail chain stores and military bases. But Monday’s letter expresses skepticism about that prospect.
“In the late 1990s, Safeway purchased all locally owned Carrs grocery stores in the state, and despite the promise of continued employment and increased competition, they soon left the state,” the letter states. “Alaska Marketplace purchased those closed stores and began business as a competitor to Safeway, but within a short period of time, the company closed, leaving many communities without competition.”
The merger must be approved by federal regulators. But the industry publication Supermarket News reported Monday the Federal Trade Commission may be leaning towards challenging the merger in court due to competition and antitrust concerns, and representatives on both sides are scheduled to meet this week to talk about the deal.
• Contact Mark Sabbatini at mark.sabbatini@juneauempire.com or (907) 957-2306.
