A U.S. District judge in Los Angeles cleared the way Wednesday for American Stores Co. of Irvine to sell 37 Alpha Beta and Lucky grocery outlets, a move that the chain intends to make at once.
U.S. District Judge David V. Kenyon issued the one-paragraph ruling Wednesday afternoon, after a half-hour hearing Tuesday.
Attorneys on both sides of the issue characterized Kenyon’s action as a procedural blip in the $2.5-billion Alpha Beta and Lucky merger saga.
In May, the Federal Trade Commission tentatively approved American’s plan to acquire Lucky Stores and merge the chain with its own Alpha Beta outlets. But the agency required American to sell 37 stores as a condition of its approval.
American later arranged to sell the markets to Certified Grocers of California, Provigo Corp. and Big Bear Markets.
American bought Lucky Stores, but its plans to combine the chains were blocked 2 months ago by Kenyon. The judge ruled in an anti-trust suit brought by state Atty. Gen. John K. Van de Kamp that the merger could result in higher food prices for Californians.
That ruling “seemed to prohibit even the sales of the (37) stores that the FTC had OKd,” said Chester Horn, deputy attorney general. Kenyon’s order Wednesday was a clarification, Horn said, and allows the sale of the 37 markets to proceed.
“We’re not disappointed,” Horn said. “We do not expect it to adversely affect the relief we ultimately expect in this case.”
Kenyon’s order halting the merger until a trial can be held is on appeal before the U.S. 9th District Court of Appeals and is scheduled for a hearing Dec. 8.
Frank Rothman, American Stores attorney, said that his client will sell the 37 stores immediately.
“Those buyers had been in place since at least August or September,” Rothman said Wednesday. “I guess the real estate lawyers are doing their thing probably starting tomorrow morning. I would say the sales would happen forthwith. It will certainly all be done in the next couple of days.”