Kroger announced Aug. 11 that it has settled litigation with C&S Wholesale Grocers, which sued the Cincinnati-based supermarket giant in the wake of a failed $25 billion merger with Albertsons.
The Keene, New Hampshire-based supplier and retailer was set to acquire nearly 600 divested stores from Kroger and Albertsons upon completion of the deal. C&S Wholesale claimed Kroger owed it a $125 million termination fee in the event the merger was called off.
Kroger said all claims were resolved. Terms of the settlement were confidential.
“We are pleased to resolve the claims from C&S, and we look forward to a friendly relationship with them going forward,” said Interim CEO Ron Sargent, in a statement.
Would-be acquirer of stores was part of merger’s failure
C&S Wholesale was seen as part of the reason for the merger’s failure. While the company supplies thousands of grocery stores nationwide, its retail operations were modest: a couple dozen stores. In the successful antitrust cases against the merger, regulators argued C&S Wholesale would not be a strong enough competitor to a super-sized Kroger. C&S Wholesale executives also faced several awkward questions during antitrust hearings when it was revealed they had mocked their own company’s retail investments.
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Litigation against Kroger in the aftermath of the abandoned merger is not over: The Boise, Idaho-based retailer announced it was also suing Kroger the same day it pulled out of the deal for allegedly botching regulatory approval. Albertsons’ lawsuit is also seeking to collect a breakup fee worth $600 million.
Details of Kroger CEO’s abrupt exit sought in two lawsuits
In that case, Albertsons is seeking the reason that Kroger’s long-serving CEO Rodney McMullen resigned in March following an ethics investigation. Kroger has offered few details of McMullen’s exit, saying only that “certain personal conduct” by McMullen was “inconsistent” with its ethics policy. Albertsons argues that Kroger’s ethical conduct, while McMullen was at the helm, is relevant to how it pursued its efforts to win merger approval.
McMullen’s departure has also come up in another lawsuit against Kroger. Grammy-nominated singer Jewel has sued the grocer for allegedly cutting her out of the Kroger Wellness Festival, which she helped organize in its early years. In that case, a judge has ordered McMullen to explain the details of his resignation, which may later be revealed in court records.
This article originally appeared on Cincinnati Enquirer: Kroger settles lawsuit related to failed $25B Albertsons merger
