Albertsons closes 35 stores after Kroger merger collapse

Albertsons Companies, the parent of Safeway and other grocery banners, has been reshaping its store portfolio following the collapse of its proposed $24.6 billion merger with Kroger. The merger, announced in 2022, was blocked by a federal court in December 2024 after the Federal Trade Commission and nine state attorneys general sued to stop it, arguing the combination would reduce competition and potentially raise prices for consumers and lower wages for workers. After the deal fell apart, Albertsons resumed its evaluation of store performance, a process it had slowed during the merger review. This evaluation has led to a significant increase in store closures. According to Albertsons' latest annual filing, the company closed 35 stores during fiscal 2025, more than triple the 10 closures in the previous fiscal year and up from eight in fiscal 2023. The company also opened nine new stores during the same period, ending the year with 2,244 locations across 35 states and Washington, D.C. The closures had a measurable financial impact: net store closures reduced fiscal 2025 sales by $63.4 million, and costs associated with closed stores and surplus properties rose to $45.1 million from $15.9 million a year earlier. Despite the closures, Albertsons continued investing in its remaining stores, completing 94 remodels and spending approximately $1.83 billion in capital expenditures, which also included investments in digital and technology platforms. The company operates 22 grocery banners, including Safeway, Vons, Jewel-Osco, ACME, Shaw's, and Tom Thumb, and employed about 280,000 workers as of February 28, 2026. Specific Safeway closures in 2026 include stores in Hayward, California; Newport, Oregon; and Washington, D.C. Albertsons has said it is working to place affected employees in other stores. The company did not provide a full list of planned closures. The failed merger has also led to litigation between Kroger and Albertsons, with Albertsons seeking a $600 million termination fee and Kroger filing counterclaims. Albertsons has disputed Kroger's account of events.