Failed mergers create perfect storms of executive departures, talent flight and investor lawsuits, but they also offer strategic reset opportunities. Using Kroger’s post-Albertsons crisis as a case study, Alvarez & Marsal’s Conor Johnston maps the three-pronged approach boards need to transform regulatory setbacks into competitive repositioning.
Kroger is on the road to recovery after a challenging few months in which the company lost a $25 billion merger bid and its CEO. The pressure is now on the board, which will need all hands on deck to bolster one of the Fortune 500’s top 25 companies.
Merging two of the nation’s largest grocery store chains would be difficult in the best of circumstances, but the December 2024 ruling that blocked Kroger’s bid to take over rival Albertsons has been particularly rough for Kroger.
In March 2025, CEO Rodney McMullen resigned suddenly following an internal investigation into personal conduct concerns. At the same time, Albertsons filed a lawsuit against Kroger for not adequately addressing regulatory concerns. These events, combined with the continued uncertainty of tariffs affecting the supply chain, has Kroger on its back foot.
Kroger needs to adapt to its new reality. Shareholders, the board and management expected significant value creation…
