35 Chicago area Mariano’s and Jewel stores to be sold in Kroger, Albertson’s merger

Kroger and Albertsons have announced plans to sell 35 Mariano's and Jewel Osco stores in Illinois as part of their joint efforts to obtain regulatory approval for a proposed $24.6 billion merger.

Kroger and Albertsons, the respective parent companies of Mariano's and Jewel Osco, have been in the process of securing the merger since it was first announced in 2022, according to Crain's.

The Federal Trade Commission (FTC) previously blocked the merger, citing concerns about competition and potential adverse effects on consumers and employees.

Kroger and Albertsons have since agreed to sell a group of stores and facilities, increasing the number of divested locations to 579, up from the previously proposed 413.

Both Kroger and Albertsons have argued that the merger is necessary to compete with larger competitors like Amazon, Walmart, and Costco. They have pledged $500 million for price reductions, $1 billion to increase wages and benefits for employees, and $1.3 billion to upgrade Albertsons stores.

According to Crain's, C&S Wholesale Grocers will acquire the divested Chicago area stores. The companies have reportedly begun notifying employees at the affected stores, with impacted workers transitioning to C&S employees once the deal is completed. The wholesale grocer has pledged to assume all existing pay, health plans, and collective bargaining agreements.

C&S Wholesale is most notably the parent company of grocery chain Piggly Wiggly and Piggly Wiggly Midwest, which operate a number of locations throughout Illinois, Wisconsin, and the Southeast U.S.

The FTC reportedly remains skeptical of the deal, arguing that C&S Wholesale may encounter difficulties integrating the acquired stores and considering the divestiture package insufficient. The companies will face a trial in August to determine the fate of the agreement.