Kroger reiterates commitment to lower prices, raise wages after Albertsons calls off merger

Following on the heels of Albertsons terminating its merger agreement with Kroger, Kroger shared that it is reiterating its commitment to lower grocery prices, raise wages and support local communities.

Albertsons terminated the agreement after the U.S. District Court for the District of Oregon granted the Federal Trade Commission's request for a preliminary injunction to block the proposed merger.

"Kroger is moving forward from a position of strength. Our go-to-market strategy provides exceptional value and unique omnichannel experiences to our customers which powers our value creation model," said Rodney McMullen, Kroger's chairman and CEO. "We look forward to accelerating our flywheel to grow our alternative profit businesses and generate increased cash flows. The strength of our balance sheet and sustainability of our model allows us to pursue a variety of growth opportunities, including further investment in our store network through new stores and remodels, which will be an important part of our 8 – 11% TSR model over time."

McMullen continued, "Kroger has an extraordinary track record of investing in America," said McMullen. "We are at our best when we serve others – our customers, associates, and communities – and we take seriously our responsibility to provide great value by consistently lowering prices and offering more choices. When we do this, more customers shop with us and buy more groceries, which allows us to reinvest in even lower prices, a better shopping experience and higher wages. We know this model works because we've been doing it successfully for many years, and this is exactly what we will continue to do."

[Related: Albertsons terminates merger with Kroger after U.S. district court blocks acquisition]

Kroger said its ongoing investments include:

• $5 billion in lower prices since 2003
• $2.4 billion in incremental wage increases on top of industry-leading benefits since 2018, a 38% increase in average hourly rate, while growing opportunities for a largely unionized grocery workforce
• $3.6 - $3.8 billion in annual capital investments to build new and remodel stores, food processing and other facilities, improve the customer experience and create additional job opportunities
• $2.3 billion to support local communities through charitable giving since 2017, including $1.5 billion to feed hungry families

[Related: Kroger files lawsuit against FTC]

"I appreciate our associates who remained focused on taking care of our customers, communities and each other throughout the merger process," McMullen said.