CHICAGO — Local grocery giants Jewel-Osco and Mariano’s are merging as part of a massive $25 billion deal.
Kroger plans to buy Albertsons, the company that runs Jewel and other grocery chains, for $24.6 billion, according to a news release. Kroger will also take on $4.7 billion in Albertsons’ debt.
The deal, which the executives hope to close in early 2024, would combine two of the United States’ largest supermarket chains. Kroger has more than 2,800 stores in 35 states, including Mariano’s. Albertsons has 2,220 stores in 34 states, including Jewel-Osco.
Together, the companies employ 710,000 workers with more than $200 billion in sales, according to CNN.
There’s no word yet on what changes, if any, the merger would bring to Mariano’s and Jewel-Osco locations in Chicago.
But the deal is expected to draw the ire of antitrust regulators and has already received criticism for consolidating the grocery industry in a time of skyrocketing food costs, according to The New York Times.
Kroger has snapped up smaller chains in recent years and bought Mariano’s in 2015. A merger with Albertsons would create a 13 percent share of the U.S. grocery market, a far second to Walmart’s 22 percent share, according to the Sun-Times.
Kroger plans to invest $1.3 billion in upgrading Albertsons’ stores and another $1 billion in raising employee wages, according to the news release.
“We are bringing together two purpose-driven organizations to deliver superior value to customers, associates, communities and shareholders,” Kroger chief executive Rodney McMullen said in a news release. “This merger advances our commitment to build a more equitable and sustainable food system by expanding our footprint into new geographies to serve more of America with fresh and affordable food … .”
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