Home » Washington state sues to block Albertsons’ $4 billion payout to shareholders
Business Economy Featured News Technology

Washington state sues to block Albertsons’ $4 billion payout to shareholders

(Reuters) -Washington State Attorney General Bob Ferguson filed a lawsuit on Tuesday to block grocery chain Albertsons Cos Inc from paying dividends to shareholders before closure of its proposed merger with supermarket operator Kroger Co.

The $4 billion payout to shareholders “risks severely undercutting the grocery giant’s ability to compete during the lengthy time period government regulators — including Washington — will be scrutinizing the merger,” according to a statement posted to the Washington Attorney General’s website.

Kroger had snapped up Albertsons in a $25 billion deal last month, creating a U.S. grocery behemoth to better compete with leader Walmart Inc on prices, but was expected to run into antitrust roadblocks.

The Attorney General will file a temporary restraining order on Tuesday or Wednesday, which, if granted, will block Albertsons from making the payment while Ferguson’s lawsuit is ongoing.

“Paying out $4 billion before regulators can do their job and review the proposed merger will weaken Albertsons’ ability to continue business operations and compete,” Ferguson added.

Albertsons responded to the lawsuit by calling it “meritless” and without “legal basis”.

“The special dividend is the means by which we are independently executing our longstanding capital return strategy,” Albertsons spokesperson said in an emailed statement to Reuters. “It will be paid regardless of whether the merger is completed.”

Kroger did not immediately respond to a request for comment on the AG’s lawsuit.

Late in October, District of Columbia Attorney General Karl Racine said that half-a-dozen state attorneys general are digging into Kroger planned acquisition of Albertsons.



Ohio Miner is a global leader in the online news. We seek to inform and engage with our readers. Staffed 24 hours, seven days a week by a dedicated team around the globe, we deliver news from journalists around the world. We are contrarian truth-seekers and truthtellers. We are journalists united by a mission to inform and engage with our readers.

We bear witness to history as it unfolds and explain not just what happened, why it happened and what it means to our readers and the public.

We are contrarian, we are committed to the news, speaking truth to power.