After nearly two years of fighting to merge his firm with Boise’s Albertsons, former Kroger CEO Rodney McMullen now claims the deal was “doomed from the beginning.”
McMullen testified in a Delaware court last week in Albertsons’ lawsuit against Kroger, where it is seeking a $600 million termination fee as well as interest and costs — totaling up to $9.3 billion.
McMullen told Judge Lori Will in Delaware’s Chancery Court that the deal was “just doomed from the beginning, unfortunately,” and placed the blame on the Biden-era Federal Trade Commission under former chair Lina Khan. The FTC sued to stop the deal, and ultimately convinced a federal judge in Oregon to put the brakes on the deal in late 2024. Albertsons broke off the deal the next day and sued Kroger.
It’s a change for McMullen, who told Bloomberg in 2023 that he and his company believed in the deal.
“We had the best advisors you can have in terms of giving us advice,” McMullen told Bloomberg. He went further in a keynote at the Groceryshop industry event.
“If you look at the original premise of the merger, the values of the two companies were so similar. And if you look in terms of some of the things being worked on, scale was even more important,” McMullen told a CNBC reporter during the event in 2023. “We had so much respect for Albertsons and the Albertsons team, and the talent they have is just really exciting. I can’t wait to see when we get to one company.”
A week before the judge in Portland handed down her decision, McMullen was asked if he had any regrets in pursuing the deal. “No, not at all,” he said on CNBC.
As BoiseDev has reported, Kroger would have acquired most of Albertsons and spun off a small number of stores to C&S Wholesale Grocers. Albertsons says that Kroger didn’t work hard enough to get regulators to buy the deal, and repeatedly put forth proposals that it knew the FTC wouldn’t accept.
Former Albertsons CEO Vivek Sankaran told Will Kroger didn’t do everything in its power to get the deal done. He said McMullen wasn’t as responsive to his outreach as the deal faced more and more regulatory scrutiny.
Sankaran and McMullen both quit their CEO jobs on the same day in March, 2025, just three months after the deal crumbled. McMullen was forced to resign his role after a short investigation by Kroger’s board found he had violated an undisclosed ethics issue, but said it wasn’t related to the business. That same day, Albertsons announced that Sankaran would exit the company and Susan Morris would take over as CEO.
The merger agreement between Albertsons and Kroger called for no more than 650 stores to be sold. Kroger initially proposed to sell 413 stores to C&S. Later the next year, after the FTC filed its challenge, the number was increased to 579.
Albertsons is working to prove to Will that Kroger breached the merger agreement and that it should be paid. The trial continues this week.
