Washington State Attorney General Bob Ferguson is suing to stop supermarket giant Albertsons from paying $4 billion to its shareholders before state and federal regulators have a chance to review its planned merger with Kroger.

The "special dividend" would weaken Albertsons' ability to compete with Kroger and grocery rivals, Ferguson argued in the lawsuit filed in Kings County Superior Court on Tuesday. The company disclosed it planned to pay for the dividend with a combination of borrowed money and cash on hand.

“Free enterprise is built on companies competing, and that competition benefits consumers," Ferguson said in a statement. "Corporations proposing a merger cannot sabotage their ability to compete while that merger is under review.”

Albertsons and Kroger operate about 330 stores in the state of Washington under Albertons' namesake banner as well as Safeway and Haggen, while Kroger operates QFC and Fred Meyer stores.

Kroger announced on Oct. 14 its plan to acquire supermarket rival Albertsons in a nearly $25 billion deal that would create a grocery juggernaut with more than 4,500 stores in 48 states. The dividend payment, which was announced as part of the deal, was scheduled to be paid next week.

Ferguson said he was seeking a temporary restraining order to block Albertsons from making the payment while the lawsuit is ongoing. His office expected a hearing this week.

The lawsuit comes one week after Ferguson joined a bipartisan group of six attorneys general from around the country to urge Albertsons in a public letter to delay paying the special dividends until the states complete their review of the proposed merger.

Albertsons declined to delay paying the special dividend. It called the lawsuit "meritless" in a statement, adding the payment would happen regardless of whether the merger was approved and would not affect the company's ability to compete.

"Payment of the special dividend will not hinder Albertsons Cos.’ ability to continue investing in our stores and technology to provide an even better shopping experience while we continue to operate as an independent company," the retailer said Tuesday.

Besides Kroger stores, the Cincinnati-based grocer currently operates several regional supermarket chains in 35 states, including Fred Meyer, Harris Teeter, Ralphs, Mariano's, Fry's, Smith's, King Soopers, QFC and others. The company has nearly 2,800 stores and employs 420,000 workers.

For the latest on Kroger, P&G, Fifth Third Bank and Cincinnati business, follow @alexcoolidge on Twitter.

This article originally appeared on Cincinnati Enquirer: Kroger-Albertsons merger: Washington AG sues to halt $4B payout