WILMINGTON, Delaware — Four years after they announced plans to combine, Kroger and Albertsons have come together again — this time in a Delaware courtroom, where the supermarket companies will try to convince a judge that the other one was responsible for causing their high-stakes deal to implode.
In a trial that began Monday in the Delaware Court of Chancery, Albertsons is demanding at least $8 billion from Kroger over its claims that Kroger reneged on its “ironclad commitment to do whatever it took to secure approval” from regulators for the merger, the company’s attorneys said in court papers made public last week.
That sum includes a $600 million merger-termination fee Albertsons has been trying to collect since December 2024, when Albertsons quickly terminated the transaction after a pair of judges blocked the merger on antitrust grounds. Albertsons also wants a multibillion-dollar settlement to cover shareholder losses it says stem from the failed merger.
Kroger claims it does not owe Albertsons anything, pointing out in a pretrial brief that both retailers were aware that gaining regulatory clearance for their combination would not be easy. Kroger says it was willing to take the risk because it believed that combining with Albertsons would provide “transformative long-term strategic value” as well as “significant near-term financial benefits.”
“For nearly three years, Kroger worked steadfastly, at great expense and with the guidance of sophisticated antitrust counsel, to secure approval of the proposed merger. But ultimately, neither the FTC nor the courts agreed with the parties that the competitive landscape for grocery retail had changed, and they blocked the merger,” a Kroger spokesperson said in an emailed statement.
The spokesperson was referring to the Federal Trade Commission, which, along with multiple state attorneys general, asked a federal court in early 2024 to stop the merger.
During the trial that began today, both Kroger and Albertsons plan to call high-profile former executives who were deeply involved in hammering out the merger deal and in trying to push it through to testify. Those executives include former Albertsons CEO Vivek Sankaran and former Kroger CEO Rodney McMullen.
Sankaran retired from Albertsons several months after the merger collapsed. McMullen departed from Kroger after an investigation found he had engaged in unspecified personal conduct deemed “inconsistent” with Kroger’s ethics policy.
Albertsons’ General Counsel Thomas Moriarty is also set to testify. Former Kroger CFO Gary Millerchip — who now holds the same role at Costco — will also take the stand, along with former General Counsel Christine Wheatley and current Chief Digital Officer Yael Cosset.
Competing claims in a high-stakes merger failure
Kroger claims that Albertsons forfeited the termination fee in part because its COO at the time, Susan Morris, had unauthorized communications with C&S Wholesale Grocers.
C&S was central to the merger agreement because it agreed to buy hundreds of stores and other assets from Kroger and Albertsons to assuage concerns that the merger would diminish competition in the grocery industry. Morris’ interactions with C&S undermined Kroger’s efforts to gain FTC approval for the divestiture arrangement, Kroger contends.
Albertsons refutes that contention, claiming that Morris — who is now Albertsons’ CEO — was in touch with C&S about potentially becoming CEO of its retail division, not about what Albertsons describes as “Kroger’s theorized conspiracy.” Albertsons also says that Morris did not improperly share information with C&S.
Instead, Albertsons claims Kroger bungled the companies’ efforts to win support for their divestiture plan
For example, Kroger received an offer to buy stores from SpartanNash and considered that company to be a stronger divestiture partner, but “sabotaged SpartanNash’s ability to obtain financing, then relied on its lack of financing to select C&S’s riskier, but more lucrative, offer,” Albertsons claims.
C&S acquired SpartanNash in 2025.
In addition, Kroger sought to choose its lowest-performing stores for divestiture and “made successive lowball offers” to regulators about unloading stores, Albertsons claims.
“Kroger refused to divest assets necessary for antitrust approval, ignored feedback from the FTC and state regulators and refused to work with Albertsons in good faith – choosing instead to prioritize its own profit targets,” an Albertsons spokesperson said in an emailed statement.
Albertsons and Kroger will make their cases before Chancery Court of Delaware Vice Chancellor Lori W. Will, a former private attorney who assumed her role in 2021. Will previously was a partner at the law firm of Wilson Sonsini Goodrich & Rosati.
Albertsons and Kroger agreed when they developed their merger plan that they would settle any potential disputes in Delaware’s court system. Kroger is incorporated in Ohio, while Albertsons is a Delaware corporation.
Once Vice Chancellor Will issues her decision, Albertsons and Kroger will have the chance to lodge an appeal with the Delaware Supreme Court, the state’s highest court.
