MTRAF - With The Merger Between Albertsons And Kroger Almost Certain To Fail I Smell A Discount
2024-02-01 07:35:24 ET
Summary
- Regulators are becoming stricter in scrutinizing potential monopolistic outcomes, leading to concerns about the $24.6 billion merger between Kroger and Albertsons.
- The market is pricing in a nearly 100% chance of the merger falling apart, creating a golden opportunity for shareholders of Albertsons.
- Both Kroger and Albertsons have seen weakening fundamental conditions, but shares of Albertsons are attractively priced and undervalued.
For better or worse, regulators are becoming even more strict than they were previously when it comes to contending with potentially monopolistic outcomes. Almost any scenario where even the prospect of consumers having to pay more or being limited in their choices is now coming under scrutiny. While this is undeniably positive for consumers more broadly when such regulatory actions achieve their objectives, the end result for shareholders can be frustrating. Just recently, the $1.4 billion acquisition of iRobot ( IRBT ) by Amazon ( AMZN ) was scuttled as it became clear that regulators in both Europe and the US were set to move against the transaction....
With The Merger Between Albertsons And Kroger Almost Certain To Fail, I Smell A Discount