Jayapal, lawmakers urge FTC to evaluate proposed Albertsons, Kroger merger

U.S. Representative Pramila Jayapal and others are urging the Federal Trade Commission (FTC) to investigate the proposed Albertsons-Kroger merger.

Reps say the mammoth $25 billion merger has dangerous anticompetitive implications—if it goes through, one company would own more than one-tenth of all grocery stores in the U.S., heavily concentrated in Washington, Oregon and California.

Jayapal was joined by Reps. Adam Smith (D-WA), Jerrold Nadler (D-NY) and David Cicilline (D-RI) in petitioning FTC Chair Lina Khan to evaluate the merger.

"This acquisition threatens to create competition-stifling concentration in markets across the country, hurting consumers, workers and small businesses," wrote lawmakers in a letter to the FTC. "For consumers, the consolidated grocery chain could offer fewer product choices and higher costs for essential goods. For workers, the acquisition could impair bargaining power for fair wages and safe working conditions in local communities. For small- and medium-sized grocers, this acquisition could diminish their already strained resources and drive up supply costs."

In Seattle, Jayapal says Albertsons-Safeway is Kroger’s biggest competitor. The merger would eliminate competition between the two top companies in the market.

WATCH: King County Court blocks Albertsons from $4B investor payout

Lawmakers cite a 2019 paper in the Review of Finance finding that in the past 20 years, some 75% of U.S. industries have grown more concentrated, with ownership shrinking to fewer and fewer companies.

Jayapal says this corporate consolidation leads to higher prices and lower customer choice.

Lawmakers also point to major grocery companies’ practices during the COVID-19 pandemic, when they hiked up prices for necessities like soap, PPE and hand sanitizer; in some cases, those prices went up by over 1,000%.

Washington Attorney General Bob Ferguson filed a lawsuit to block Albertsons’ $4 billion shareholder payout ahead of the proposed merger, and Washington Senators Maria Cantwell and Patty Murray issued a joint statement to the FTC warning of the merger.

PREVIOUS COVERAGE: Washington leaders slam proposed Albertsons, Kroger merger

Get breaking news alerts in the FREE FOX 13 Seattle app. Download for Apple iOS or Android. And sign up for BREAKING NEWS emails delivered straight to your inbox.

There is precedent for their concerns, the senators wrote—citing the 2015 merger of Albertsons and Safeway. The companies were required to sell 150 stores to another company, which later went bankrupt. Albertsons then reacquired some of those stores, which the senators say undercuts the objective of competition entirely.

That history "does not bode well for another Albertsons merger," Cantwell and Murray wrote.

You can read the lawmakers’ full letter here.