Salad maker Fresh Express ditched a million-dollar deal to acquire Dole's vegetable business
The deal fell through amid regulatory concerns that it would lead to reduced competition and higher prices
Salad kit maker Fresh Express is abandoning a $308 million deal to acquire food company Dole’s vegetable business, the Justice Department said.
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“At a time when food companies are already overcharging Americans for groceries, [the] abandonment preserves lower prices and availability for an essential kitchen staple,” the agency said in a statement Thursday.
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The collapse of the deal with prompted partly by regulators’ concerns that the partnership would reduce the number of competitors from three to two, the Justice Department said. That would in turn raise grocery prices for items that 85% of U.S. households purchase, the agency said. Packaged salads represent $3.2 billion in spending each year by grocery store operators and customers, it added.
The nixed deal comes even as the supermarket chains Kroger and Albertsons are trying to join forces. The grocery store operators have also dealt with regulatory pushback.
In February, the Federal Trade Commission sued Kroger, saying the deal would lead to reduced competition and higher grocery prices. In an effort to make the deal — considered to be one of the largest merger proposals in American history — more appealing, the grocery chains hinted at selling hundreds of stores.
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