Kroger plans to acquire regional grocer and pharmacy retailer Giant Eagle in a deal valued at $1.65 billion. Giant Eagle, a privately held company, operates 197 supermarkets and 11 standalone pharmacies across northern Ohio, western Pennsylvania, West Virginia, Maryland, and Indiana. Under the terms of the deal, Giant Eagle will retain its name.
Kroger is the largest U.S. supermarket chain with 2,685 stores in 35 states and the District of Columbia. The company’s stores include brands such as Ralphs, King Soopers, Smith’s, and Fred Meyer. The transaction comprises $1.25 billion in cash along with the assumption of about $400 million in outstanding liabilities.
“Giant Eagle is a well-run, high-quality regional grocer with a strong reputation for fresh products, pharmacy, private label, and customer loyalty,” stated Kroger CEO Greg Foran.
Foran became Kroger’s CEO in February, coming from Walmart. Traditional grocers, including Kroger, face challenges as more customers choose to shop at big retailers like Walmart, Costco, and Amazon, alongside discount chains like Aldi.
Previously, Kroger planned a merger with rival Albertsons to compete better against larger retailers. However, the Federal Trade Commission and the states of Washington and Colorado opposed it, concerned about higher prices and lower wages. The merger was abandoned in late 2024 after judges halted the deal in separate cases.
Burt Flickinger, an analyst and managing director of Strategic Resource Group, praised Kroger’s move to acquire Giant Eagle. He described it as “a master stroke” since it provides Kroger access to the mid-Atlantic, Northeast, and New England. Flickinger stated there should be no antitrust concerns, as Kroger typically lowers prices following acquisitions.
The acquisition requires regulatory approval and is expected to close next year. Kroger and Giant Eagle may need to divest some Giant Eagle stores to obtain this approval. On Wednesday, Kroger’s shares remained unchanged during afternoon trading.