Think tank warns Kroger’s takeover of Giant Eagle would harm consumers
‘Kroger isn’t buying stores. It is buying data,’ says the American Economic Liberties Project.
By JAMES ENGEL
TribLive
A new study from a Washington, D.C. think tank asks regulators to block grocery titan Kroger’s $1.65 billion acquisition of Giant Eagle, saying the deal would increase prices and customer surveillance and harm unionized workers.
The American Economic Liberties Project, an antitrust research group, said Cincinnati- based Kroger’s acquisition of the Western Pennsylvania hallmark would expand the reach of Kroger’s consumer tracking data, which it said the chain uses to build “robust profiles on consumers’ shopping habits.”
“Kroger isn’t buying stores. It is buying data. Kroger’s privacy policy, updated in September, discloses that the company collects facial recognition data from shoppers entering select stores and that its cameras capture license plates,” the study said.
The deal, unanimously approved by Kroger’s board of directors, was abruptly announced in July. It would see Kroger, which operates more than 2,700 stores, shell out $1.25 billion in cash and take on about $400 million in assumed liabilities, according to a filing by Kroger with the Securities and Exchange Commission.
Kroger did not reply to Trib-Live requests for comment.
Giant Eagle, a family- owned grocery store and pharmacy chain based in Cranberry, has 197 supermarkets and standalone pharmacies throughout Western Pennsylvania, northern Ohio, West Virginia, Maryland and Indiana. As part of the deal, it would maintain its brand and leadership. A company spokesperson declined to comment for this story.
The study asks the Federal Trade Commission and Ohio Attorney General’s office to sue to halt the deal.
Giant Eagle directly competes with Kroger in several markets, mostly notably Columbus, Ohio — where the rival stores sit directly across the street from each other in at least three places, according to the study.
Were the merger to move forward, it would likely raise prices for consumers because the chain would have little need for promotional pricing competition in some markets, the study said.
The acquisition could also harm employees, according to the study. Most Kroger and Giant Eagle stores are union shops, but that’s not universal.
Workers, represented by the United Food and Commercial Workers union, would have reduced bargaining power and fewer employment options facing down a consolidated Kroger-Giant Eagle, the study said.
“In buying Giant Eagle, particularly in Columbus, Kroger will leave workers with fewer options for employment, likely leading to worse hours, pay, leave, and working conditions,” it said.
But the chief concern of the study is the potential effects of consumer surveillance and dynamic pricing — a technique used by companies to adjust prices in real time, often driven by AI.
U.S. Sen. Josh Hawley, R-Missouri, criticized Kroger during an August hearing, saying the grocery chain collects vast amount sof data on its customers and had raked in hundreds of millions selling that data to third parties.
“Kroger is not just a grocery store… it is a data selling megacorporation,” Hawley said. “Kroger’s loyalty program has a treasure trove of data on you.”
Across the aisle, U.S. Sen. Elizabeth Warren, D-Massachusetts, raised concerns about several consolidations in the grocery and food service industry — the Kroger- Giant Eagle deal among them — saying consumers will “face higher prices and have fewer choices.”
“There is already considerable overlap between Kroger’s and Giant Eagle’s respective territories, generating serious concern that the acquisition will lead to reduced competition in local markets and higher grocery prices for consumers,” Warren said in a statement earlier this month.
The study repeatedly referred to the FTC’s successful efforts in 2024 to block Kroger’s merger with Idaho- based Albertson’s, citing concerns about reduced competition and price hikes for consumers.
