Kroger is buying regional supermarket chain Giant Eagle for $1.65 billion, a deal that would expand the grocer’s presence across the Midwest and Mid-Atlantic regions.
The transaction includes $1.25 billion in cash and the assumption of about $400 million in outstanding liabilities, the companies said on July 1.
Giant Eagle, a family-owned business founded in 1931, operates 197 supermarkets and 11 standalone pharmacies across western Pennsylvania, northern Ohio, West Virginia, Maryland, and Indiana. The company generates about $9 billion in annual sales, according to Kroger.
“Giant Eagle is a well-run, high-quality regional grocer with a strong reputation for fresh products, pharmacy, private label and customer loyalty,” Kroger CEO Greg Foran said in a statement. “We evaluated the opportunity carefully, and the strategic fit is clear.”
“Today’s announcement marks an exciting next chapter for our team members, customers, vendors and community partners,” Giant Eagle CEO Bill Artman said, adding that the deal would give the company more resources to improve its stores, customer experience, and growth prospects.
The companies expect the deal to close in 2027, subject to regulatory approval and other customary closing conditions. Kroger said the acquisition is expected to add to adjusted earnings in the second full year after completion.
The agreement marks Kroger’s first major acquisition since its proposed $25 billion merger with smaller competitor Albertsons fell apart. That deal would have created a grocery giant with roughly 5,000 stores across the United States, but the companies abandoned the transaction in December 2024 after the Federal Trade Commission sued to block it and a federal court upheld the challenge.
The failed merger led to more court battles. Albertsons sued Kroger, accusing the Cincinnati-based grocer of failing to do enough to secure regulatory approval, while Kroger rejected the claims and countersued Albertsons.
The collapse was also followed by the ousting of Kroger’s longtime Chairman and CEO, Rodney McMullen. Foran, a former Walmart executive, formally assumed the role of chief executive in February.
The Giant Eagle acquisition comes as Kroger is also expanding through its larger-format Marketplace stores, which carry general merchandise in addition to a standard grocery assortment. Kroger Marketplace locations are typically about 100,000 square feet, far larger than the average U.S. grocery store, which spans roughly 44,000 square feet, according to FMI—The Food Industry Association.
Earlier this year, Kroger said it had broken ground on a 123,000-square-foot Marketplace store in Crawfordsville, Indiana. The company also plans to open new Marketplace locations in Noblesville and Zionsville, Indiana, later this year.
