Here's what we know about the grocer buying Kroger and Albertsons stores in Washington state
![caption: Kroger first announced its plans to buy Albertsons in October 2022.](https://kuow-prod.imgix.net/store/db3cb50d429f1b7e8900b317160a1564.jpg?ixlib=rails-4.3.1&fit=clip&crop=faces&auto=format&w=924&h=634)
Little is known about C&S Wholesale Grocers, the company that’s buying hundreds of stores around the country, divested under the Kroger-Albertsons merger. If the deal overcomes its legal challenges, it will pave the way for C&S to establish a large footprint in the Northwest.
Here’s what we do know about C&S Wholesale Grocers: It’s a national wholesaler, a privately held company based in New Hampshire. The $2.9 billion purchase from Kroger-Albertsons would be its largest acquisition by far.
To date, the company operates 23 grocery stores under the banners Grand Union and Piggly Wiggly through the Midwest, South and Northeast. In recent years, it has also invested in robotic warehouse automation.
“They’re family-owned, they’re not owned by a private equity firm,” said Scott Moses, a partner at the financial firm Solomon Partners, who is advising Albertsons on the merger. “They’ve got a 100-year operating track record as a leading grocery merchant.”
Moses says C&S is a strong buyer and well capitalized. As a wholesaler, the company already supplies 7,500 independent stores.
“Which then means their supply business can get better prices on the stuff that it buys and then pass along those savings to all of the stores,” Moses said. “So it’s a symbiotic relationship that’s going to be really good for those stores.”
Moses said the acquisition would make C&S the 10th largest grocery operator in the country based on number of stores.
Still, critics worry that status won’t be enough to keep stores open. They fear a repeat of 2015 when Albertsons merged with Safeway and sold off more than 140 stores on the West Coast. Less than a year after the sale, the buyer filed for bankruptcy. Albertsons bought back most of the stores, and closed some of them.
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John Marshall, a financial analyst with UFCW 3000, the local union for grocery workers in Washington, said he's skeptical that C&S can successfully absorb the new stores.
“I think Kroger wanted to have it both ways," Marshall said. "They wanted to be able to divest a certain number of stores to give the appearance that they’re trying to remedy the anti-competitive effects of their proposed merger. At the same time they don’t want to have a real competitor who they would lose market share to.”
The unions are also concerned whether C&S will honor worker contracts.
“We need to see something in writing, more than just their statements that’s what’s going to happen,” said Kathy Finn, UFCW 770 president.
In the coming months, state and federal courts will decide the fate of the Kroger-Albertsons merger. At the heart of the antitrust suits filed by Washington, Colorado, and the Federal Trade Commission, is that the merger would limit competition and lead to higher prices.
But the merger’s impact on prices is only one measure of what could happen to the grocery landscape, says Hart Hodges, professor of economics at Western Washington University.
Big-box and discount stores are forcing change in the grocery industry. Hodges doesn’t expect that disruption to let up.
“Grocery stores are going to look different five years from now, 10 years from now, than they look today,” Hodges said. “It’s hard to ask, 'Can this company that’s coming in innovate?' It’s not just what do I look for right now. But will they be investing, will they be innovating? And will they be responsive?"
As for C&S’s plans for the expansion, the company’s affiliate, 1918 Winter Street Partners, will oversee the new stores. C&S has also tapped Susan Morris, Albertsons' chief operations officer, to lead its retail business.
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