IL Attorney General Kwame Raoul Files Lawsuit To Halt Jewel Merger

ILLINOIS — Less than a week after urging Albertson’s and Kroger from merging and paying out an estimated $4 billion in payouts to shareholders, Illinois Attorney General Kwame Raoul has filed a lawsuit attempting to delay the deal.

Raoul, along with the Attorneys General from the District of Columbia and California, filed the lawsuit against Albertson's and Kroger in U.S. District Court in Washington, D.C. on Wednesday, the attorney general's office announced on Wednesday.

The suit comes on the heels of Raoul announcing that he was part of a bipartisan coalition that is aiming to prevent Albertson’s and Kroger from making the multi-billion-dollar payout to shareholders next week.

Raoul said that the merger will create "a major shakeup" at a time when the average family in Illinois struggles to pay for food as costs at the grocery store have spiked due to inflation and supply chain issues.

The payout is expected to be made on Nov. 7 and the coalition announced that they wanted the two major grocers to hold off on the payout until the Attorneys General could review the merger. The group said in a joint statement that they fear that the merger could severely reduce competition and could lead to increased food costs.

In Illinois, the deal has an impact on Jewel-Osco markets, which are owned by Albertson’s and Mariano’s stores across the greater Chicago area that are owned by Albertson’s. All together, the merger could affect about 150 stores from the two brands, along with Food 4 Less, which operates 10 stores that are owned by Albertson’s, Crain’s reported.

Kroger announced last month it had acquired Albertson’s in October for $24.6 billion. Raoul said in a news release that the impact of a merger is intensified with inflation continuing to run at historically high levels. Consumer grocery prices rose 12.2 percent from 2021 to 2022, marking the biggest jump in more than 40 years. Raoul also said that the private equity investors who control the grocery chains will have gained profits nine times larger than their original investments in 2006 if the merger is approved.

“With so much at stake, it is imperative our merger review process continues, allowing us to evaluate the effect of this merger on workers and consumers, particularly in historically disinvested neighborhoods already lacking healthy food access," Raoul said in the statement issued on Wednesday after the suit was filed. "Neither company should be attempting to undermine our review process.”

Albertson’s said in a statement released to Patch last week that the chain does not feel like the merger would create a problem, but instead, would be in the best interest of everyone involved.