By David Ritter and Conor Gaffney
Source: Grocery Dive
Kroger and Albertsons recently shocked the retail world by announcing a nearly $25 billion arrangement that will combine two of America’s top grocers and result in a national network of 5,000 stores and annual revenue of about $200 billion. While a deal of this size and scale is likely to receive a significant amount of regulatory scrutiny, the two sides appear to be moving full steam ahead.
Beyond its sheer scale, the deal is a landmark event in the world of grocery, as it enables Kroger’s world-class omnichannel capabilities (including Ocado) and Kroger Precision Marketing expertise to be scaled across Albertsons’ full network. It also brings together over 2,000 convenience stores to create a seamless retail ecosystem across 48 states. Leaders from both organizations touted $500 million in potential synergies with a desire to pass those savings along to end consumers in the form of lower prices — a scary proposition for regional grocery competitors.