A food workers’ union local bucks its peers, backs Kroger’s takeover of Albertsons. Why?

A union local that represents more than 1,000 Albertsons grocery workers in Idaho has bucked its peers and endorsed Kroger’s merger with Albertsons.

Local 555 of the United Food and Commercial Workers Union says its members would likely be better off with the merger than without it, because multiple stores where its members work would be sold to a third company whose leadership impressed union representatives.

That company is C&S Wholesale Grocers, a little-known grocery-supply firm owned by a New Hampshire billionaire that also oversees two retail supermarket chains in the South, Midwest and Northeast. Kroger in September agreed to sell 413 Kroger- and Albertsons-owned stores, including 13 Albertsons stores in Idaho, to C&S to ease federal regulators’ antitrust concerns.

“After meeting with C&S on the divestitures of stores as part of the Kroger/Albertsons merger, we were pleased to find not only that they understood and liked the grocery business, but also recognized the importance of quality employees to their ongoing success,” said Dan Clay, the president of UFCW Local 555, in a statement posted on the local’s website after the union met with C&S executives.

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Kroger Co., a Cincinnati grocery chain whose stores include Fred Meyer, proposed in 2022 to take over Albertsons, the Idaho-based company that Joe Albertson founded 85 years ago with a single supermarket in Boise.

Local 555, based in Tigard, Oregon, a suburb of Portland, formerly represented grocery and other workers just in Oregon and Washington, but it expanded into Idaho in 2021 after the UFCW’s Local 368A in Boise voted to merge into Local 555. That brought 1,100 workers in southern Idaho, eastern Oregon and western Wyoming into the local, the Northwest Labor Press reported.

The local’s endorsement places it at odds with a coalition of union locals that says it represents 100,000 Kroger and Albertsons workers in more than a dozen states, including some in North Idaho.

“We oppose this merger in the strongest terms possible and remain hopeful for federal enforcement action to block it and protect consumers, workers, and the public,” the UFCW 3000 said Tuesday in a news release.

The companies’ haven’t said which 13 Idaho stores would be divested. A spokesperson for UFCW Local 555 told The Oregonian that the union wasn’t told which stores would be sold to C&S either.

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“Grocery is a business of constant change, however, for our members the important things won’t change: Their working conditions will be maintained, their retirements secure, and their health care in place.,” Secretary-Treasurer Sandy Humphrey said in the local’s statement.

A third local leader noted that while Albertsons Cos. is publicly traded, a large share of its stock remains under the control of Cerberus Capital Management, a New York private-equity firm that leads a group of investment companies that first acquired part of the former Albertsons Inc. in 2006.

“Cerberus no longer wants to own Albertsons,” said Vice President Ann Poff, who works for Safeway, which Albertsons acquired in 2015. “Communities in the Pacific Northwest want to know basic goods and services necessary to care for their families are available at a fair price. Forcing Cerberus to continue to own Albertsons isn’t an option. If they don’t sell to Kroger, it will be someone else. Our members would rather work for people who run grocery stores over online or big-box retailers.”

FTC may sue to block merger soon, report says

Meanwhile, Bloomberg reported Wednesday that the Federal Trade Commission and several states could sue to block Kroger’s takeover before the expiration on Feb. 28 of an agreement the companies made with the FTC not to close the merger before then. Bloomberg’s report cited “people familiar with the plans.”

Kroger said it “remains in ongoing discussions with the FTC and state regulators,” and Albertsons said it is “continuing to work closely with the FTC,” Reuters reported.

Kroger on Feb. 13 renewed its pledge to lower prices if the merger is approved. Kroger said it “consistently lowered prices and improved the customer experience during previous mergers.”

Kroger also pledged to spend $1.3 billion to improve Albertsons stores.

Albertsons is Idaho’s largest company and a Boise icon, with 290,000 employees nationwide and more than 5,000 employees in Idaho, the Idaho Statesman previously reported. It operates nearly 2,300 stores in 34 states under multiple banners.

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