Albertsons sued over move to pay shareholders $4 billion as part of merger deal
Kroger, the parent company of Fry’s Food and Drug stores, announced its plan in October to buy grocery chain Albertsons for about $20 billion.
Several attorneys general are now suing to block Albertsons from paying a nearly $4 billion dividend to its shareholders.
The lawsuit filed Wednesday by attorneys general in California, Illinois and the District of Columbia is the second this week. Washington state filed a similar one Tuesday.
This comes after a bipartisan group of top state prosecutors, including Arizona Attorney General Mark Brnovich, signed a letter asking Albertsons to hold off on paying the $4 billion dividend until a review of the merger was complete.
Brnovich said the deal could seriously hurt consumers and workers.
Albertsons said the dividend should be paid whether or not the merger goes through, and denied that it will hamper its ability to invest in stores. The grocer had nearly $29 billion in assets at the end of September.