By Jaewon Kang and Leah Nylen | Bloomberg
Kroger Co. released the full list of stores, distribution centers and plants — including 63 supermarkets in California — that it plans to divest to secure approval for the proposed merger with Albertsons Cos.
The companies have started notifying staff at affected locations, Chief Executive Officer Rodney McMullen wrote in a memo to employees on Tuesday.
Workers, a majority of them in Southern California, will become employees of C&S Wholesale Grocers after the transaction closes, McMullen wrote, and will remain as Kroger and Albertsons staff until then. C&S has committed to transferring pay and health plans and assuming all collective bargaining agreements, he added.
The grocers, which announced their $25 billion merger in October 2022, are sharing the list ahead of a trial expected in August that will decide the outcome of their deal.
Kroger and Albertsons agreed to sell a package of stores and other facilities to C&S, boosting the number to 579 from 413 in April after the Federal Trade Commission blocked the tie-up. The divestment sale was valued at $2.9 billion in April.
The list also includes 124 stores in Washington state, 101 in Arizona and 91 in Colorado, among others. Most of the California stores are in Southern California.
The divestment package also includes a dairy plant in Colorado, as well as six distribution centers across four states.
Together, Kroger and Albertsons have nearly 5,000 stores across the country, including banners like Kroger, Ralphs, and Harris Teeter as well as Albertsons, Safeway, Acme and Jewel-Osco.
Kroger and Albertsons say they need the merger to compete with larger, non-unionized rivals Amazon.com, Walmart and Costco. The companies have pledged to invest $500 million to cut prices and $1 billion to raise worker wages and benefits, in addition to $1.3 billion to improve Albertsons stores.
The FTC’s complaint alleges the deal would harm consumers by eliminating competition on prices and quality, making the combined firm less likely to improve its services by offering flexible hours and pickup services. It also would give the grocers increased leverage over workers, slowing wage growth and worsening benefits, according to the complaint.
Union workers in California also are protesting the planned merger, saying their jobs could be in jeopardy in any divestiture.
The FTC has also alleged that C&S would face significant challenges stitching together the various stores acquired from the grocers, and deems the grocers’ proposed divestiture package inadequate. In 2015, the agency allowed Albertsons to buy Safeway after it sold 168 stores, the bulk of them to Washington state grocer Haggen Holdings LLC. Less than a year later, Haggen filed for bankruptcy and Albertsons bought back a number of the stores.
The list of stores to be sold to C&S includes dozens of locations that Albertsons reacquired, including 12 Haggen stores in Washington.
The Haggen brand will spark the many memories among Southern California shoppers, who saw 70 grocery stores in the region convert to the Pacific Northwest banner nine years ago.
The grocer bought 146 stores in the Albertsons-Safeway divestiture in 2015.
Haggen’s concept, which touted itself as Albertsons meets Whole Foods, didn’t take with shoppers who complained of high prices. The banner would be gone in just six months.
The vacant properties left behind in Haggen’s exit languished for years, only recently updating to new names such as Rivera Food Service or familiar chains like Gelson’s and 99 Ranch Market.
Here is the list of California stores that Kroger and Albertsons said would be sold to C&S Wholesale:
15 Albertsons changing banners
Carson: 200 E Sepulveda Blvd.
Dana Point: 33601 Del Obispo St.
El Cajon: 2899 Jamacha Road
Huntington Beach: 7201 Yorktown Ave.
Huntington Beach: 16600 Bolsa Chica St.
Lompoc: 1500 N H St.
Los Angeles: 3901 Crenshaw Blvd
Morro Bay: 730 Quintana Road
Newbury Park: 541 S Reino Road
Northridge: 9022 Balboa Blvd.
Palm Desert: 42095 Washington St.
Palm Springs: 1751 N Sunrise Way Ste 1
San Clemente: 804 Avenida Pico
Spring Valley: 543 Sweetwater Road
Wildomar: 23893 Clinton Keith Rd
31 Vons stores changing banners
Agoura Hills: 5671 Kanan Road
Burbank: 301 N Pass Ave
Camarillo: 820 Arneill Road
Carlsbad: 6951 El Camino Real
Carlsbad: 3439 Via Montebello
Costa Mesa: 185 E 17th St.
Del Mar: 2606 Del Mar Heights Road
Inglewood: 500 E Manchester Blvd.
La Crescenta: 3233 Foothill Blvd
La Quinta: 78271 Hwy 111
Long Beach: 1820 Ximeno Ave.
Los Alamitos: 11322 Los Alamitos Blvd.
Los Angeles: 3118 S Sepulveda Blvd.
Los Angeles: 3461 W 3rd St.
Los Angeles: 1430 S Fairfax Ave.
Los Angeles: 6571 W 80th St.
Manhattan Beach: 410 Manhattan Beach Blvd
Montrose: 2039 Verdugo Blvd.
Pacific Palisades: 17380 Sunset Blvd
Palm Springs: 4733 E Palm Canyon Drive
San Diego: 11986 Bernardo Plaza Drive
San Diego: 1702 Garnet Ave.
San Pedro: 1440 W 25th St.
Santa Barbara: 163 S Turnpike Road
Santee: 9643 Mission Gorge Road
Stevenson Ranch: 25850 The Old Road
Studio City: 4033 Laurel Canyon Blvd.
Suite 100: 2495 Truxtun Road
Tarzana: 18439 Ventura Blvd.
Tujunga: 7789 Foothill Blvd.
Ventura: 6040 Telegraph Road
16 Pavilions changing banners
Beverly Hills: 9467 W Olympic Blvd.
Burbank: 1110 W Alameda Ave.
Culver City: 11030 Jefferson Blvd.
La Jolla: 7544 Girard Ave.
Laguna Beach: 600 N Pacific Coast Hwy.
Malibu: 29211 Heathercliff Road
Marina del Rey: 4365 Glencoe Ave
Newport Beach: 2660 San Miguel Drive
Newport Beach: 1000 Bayside Drive
Palos Verdes Peninsula: 7 Peninsula Center
San Clemente: 989 Avenida Pico
San Diego: 3850 Valley Centre Drive
Seal Beach: 1101 Pacific Coast Hwy.
Sherman Oaks: 14845 Ventura Blvd
West Hills: 6534 Platt Ave.
West Hollywood: 8969 Santa Monica Blvd.
One lone Safeway at 1499 Washington Ave. in the Bay Area city of San Leandro is switching banners.
Staff writer Samantha Gowen contributed to this report.