![]() ![]() By decreasing the number of outside options available to workers, the merger will limit competition for hiring and retaining employees, and grocery store worker earnings will fall as a result. “Workers’ ability to negotiate better pay and working conditions rests on their capacity to switch jobs. “Given the lack of transparency, and the impact a merger between two of the largest supermarket companies could have on essential workers and the communities and customers they serve, the UFCW stands united in its opposition to the proposed Kroger and Albertsons merger.”Ī few days earlier, a report by Washington, DC-based think tank the Economic Policy Institute (EPI) said that if the merger were approved it would reduce the number of outside employment options available to workers, lowering grocery store workers’ annual wages by a total of $334 million – about a $450 loss in annual wages per worker. ![]() At our 9th Regular Convention, hundreds of UFCW delegates representing our entire union from around the country came together to unanimously declare mergers pose a serious threat to the livelihoods of our members, and we must act to confront them,” UFCW International president Marc Perrone said in a statement. “For months, the UFCW has called for transparency, engaged independent experts and assessed the publicly available information on this proposed merger to determine the widespread impact it will have on our members and the communities they serve. In recent weeks, the UFCW has doubled down on that narrative by officially rejecting the merger at their annual convention earlier this month. He added that discussions with the FTC were continuing and the deal’s progress is “where we thought we would be at this time.” In this case we both committed to litigate in advance,” emphasizing that regulators haven’t indicated opposition to the proposed transaction at this time. They also touted that their business strategy is to lower prices and expand product selection.Ībout two weeks later in an interview with Bloomberg, McMullen went on the offensive again noting, “Usually you wouldn’t commit in advance to litigate. Late last month Rodney McMullen and Vivek Sankaran, CEOs of Kroger and Albertsons respectively, wrote an op-ed piece in the Cincinnati Enquirer defending the deal, noting that no frontline workers would be laid off and that all stores, even ones that are divested (and presumably unsold), would remain open. At some point, the harsh criticism merits a level of counter-response.Īfter staying silent for nearly six months (except to fight legal action by several states to nullify the deal and stop Albertsons’ $4 billion special dividend), both chains are fighting back. Perhaps this was a preordained strategy, but I believe that at least part of the uptick in action comes from the loud backlash both retailers have felt from several interested and important parties. Considering more than 13.8% of RAD stock's float is currently sold short, it's possible some of the activity at these out-of-the-money calls is a result of shorts initiating an options hedge against any unexpected upside risk.While the ultimate decision if the FTC approves the Kroger-Albertsons merger is likely 10-16 months away, both retailers have taken a more aggressive posture in recent weeks when it comes to promoting the benefits of the $24.6 billion transaction. The stock's March and April 2.50 calls have seen notable increases in open interest over this two-week time frame, and data from the major options exchanges confirms buy-to-open activity. At the International Securities Exchange (ISE), Chicago Board Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), RAD stock's 10-day call/put volume ratio of 14.63 ranks in the 74th annual percentile. Options traders, however, have been buying to open calls over puts at a rapid-fire rate in recent weeks. 9 four-year low of $1.39, the rally was quickly contained by their 180-day moving average - a trendline the security has not closed north of since mid-January 2017. And while Rite Aid shares have come off their Nov. ![]() Today's pre-market upside marks a change of pace to RAD's longer-term technical trajectory, with the stock down 63.7% year-over-year. The deal is expected to close in the second half of this year, with Albertsons expected to trade on the New York Stock Exchange (NYSE) after it is finalized, following 2015's shelved initial public offering (IPO). RAD CEO John Standley will head the combined company, which is expected to bring in roughly $83 billion in annual revenue. Rite Aid Corporation (NYSE:RAD) stock is up 11.5% in electronic trading, after grocery chain Albertsons said it will buy the parts of the drugstore that are not being sold to Walgreens Boots Alliance (WBA) - following last year's failed merger. ![]()
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