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Axios reports that the Federal Trade Commission (FTC) likely is on a path to trying to prevent Kroger's $24.6 billion acquisition of Albertsons.

That insights comes from former FTC policy director David Balto and a source familiar with the FTC's thinking, both of whom spoke to Axios.

According to the story, "Despite the effort the merging parties have gone to, to appease the FTC, they have run straight into the headwinds of antitrust enforcement, Balto says."

Balto also argues that the deal that Kroger made with C&S Wholesale Grocers to sell it more than 400 hundred stores, contingent on an FTC approval of the merger, probably hasn't be persuasive, and that "if Kroger had found a multi-brand acquirer like Ahold Delhaize to buy its divestiture, it may have improved its chances of gaining the FTC's blessing."  Balto suggests that C&S is more a wholesaler and an operator, even though it does own and operate stores, and that "the standard under the law is a merger is anti-competitive unless there is a remedy that fully restores competition."  Ahold Delhaize might've been a more acceptable company to which Kroger could've sold divested stores.

In addition, the speculation is informed by the fact that "FTC chair Lina Khan has gone on a listening tour of sorts, most recently in Las Vegas … where she voiced concerns about the merger.

"She specifically cited the merger of Safeway and Albertsons as an example of a deal that did not fulfill its commitments."

"If there's a merger that is presenting a lot of risk of reducing competition, may even create a monopoly, you know, we need to weigh those risks, and especially given that some of these remedies in the past have failed," Khan said in Las Vegas.

KC's View:

It has been my feeling all along that the FTC would try to block this deal, and that Kroger and Albertsons would have to go to court to prevail.  That seems to be the conventional wisdom, though there is some disagreement about how the courts would rule - Balto seems to feel that the FTC would be successful in trying to block the deal.  So we'll see.  (There's also the possibility that the last shoe hasn't dropped, and that something could happen to make the deal more palatable to the FTC.)

As in the case with the FTC's suit against Amazon, this FTC clearly seems to be looking to establish certain parameters for competition that it feels are appropriate to 21st century realities.  It remains to be seen whether it will be successful, but I do think that public policy benefits from an airing out of these issues.