The CEOs of Albertsons and Kroger, which plan to merge as part of a $20 billion deal, vowed during a Senate subcommittee hearing yesterday to keep prices low and protect jobs, reports The Wall Street Journal.
Rodney McMullen, CEO of Kroger, and Vivek Sankaran, CEO of Albertsons, testified before the Subcommittee on Competition Policy, Antitrust and Consumer Rights, where senators questioned whether the deal would reduce competition and lead to higher prices.
“Kroger currently is ranked fourth in total revenue among U.S. grocery retailers behind Walmart, Amazon and Costco,” McMullen said in a statement. “A combined Kroger and Albertsons will remain at number four.”
Senator Mike Lee said the grocery retailers haven’t explained why the merger is necessary and whether commitments on prices, wages, and stores will be fulfilled, according to the report.
“Inflation, to put it gently, is wreaking havoc on our entire economy but not on the grocery industry, it appears,” Lee said.
McMullen said the combined entity intends to keep prices low and won’t lay off any store workers. He said that price cuts would start immediately, and that the companies expect to invest $500 million over four years on that effort.
“I just don’t see less competition going forward,” McMullen said.
Albertsons’s Sankaran said that his company determined that merging with Kroger represented the best way to compete against Amazon and Walmart and that the intent isn’t to close stores. Full Story (Subscription Required)
Related: Kroger, Albertsons CEOs Face Congressional Questioning; Albertsons Seeks to Overturn Restraining Order.