The parent companies of Alaska’s two largest grocery chains are set to merge, which is bad news for our state.
Thankfully, we can stop this merger. The Federal Trade Commission (FTC) has the authority to block mega-mergers that reduce competition in the marketplace.
Alaskans know what happens when grocery stores merge because we’ve seen this before. In 1999, when Safeway bought Carrs, they were required to “spin-off” several stores, which means they sold those stores to another company. But those spin-off stores quickly went out of business, leading to fewer options for Alaskan consumers and a more consolidated, vulnerable food supply chain. The same thing happened again in 2015
when Albertsons bought Safeway.
The mega-merger between Kroger (Fred Meyer) and Albertsons (Carrs/Safeway) would hurt Alaskan consumers, producers, and workers alike. The merger would likely mean that stores will close, our workers will lose good jobs, and our farmers will get paid less, all while we will pay more.
In a recent announcement, Kroger stated it expects to sell 14 Albertsons stores in Alaska. Currently, Albertsons has 11 Carrs and 12 Safeway locations, meaning that unless they have other properties, that means they’re going to be selling off over half of their stores. This time they’re planning to sell these stores to another national chain, C& S. But as far as we can tell, C& S has no proven experience operating in Alaska, or even the West Coast. Spinning-off stores won’t effectively protect Alaskans. We fear a repeat of previous mergers.
This merger would mean higher prices for the average Alaska consumer. And potential store closures would mean hundreds, possibly thousands, of good jobs lost, many of which come with top-of-the-line health insurance and a pension. Additionally, fewer grocery stores would mean Alaska’s food producers would have fewer buyers to sell their food to, increasing the already oversized power of grocery chains to exploit farmers. Simply put, there is no evidence this merger will do anything but hurt Alaskans.
We need to insist that the FTC block this merger, and we are pleased that our federal delegation has joined us in opposition. We thank Rep. Mary Peltola, who sent a letter to the FTC reflecting concerns that this merger will harm Alaskans and urging them to block the merger. We also thank Sen. Lisa Murkowski and Sen. Dan Sullivan for sending a joint letter to the FTC calling on the commission to consider Alaska’s unique circumstances and ensure protections for Alaska workers and union contracts.
This will be a long fight. Given the complicated regulatory landscape and sheer size of the nearly $25 billion transaction, the FTC will likely not make a ruling until 2024. In the meantime, it is critical that Alaskans are aware of what’s at stake and speak out.
— Graham Downey, Economic Justice Lead; AKPIRG
Alex Baker, vice-president of UFCW Local 1496; and
Amy Seitz, executive director, Alaska Farm Bureau
Anchorage
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