Kroger Agrees to Buy Giant Eagle for $1.65 Billion in Cash and Assumed Debt

Quick Facts

Kroger will pay $1.25 billion in cash and assume $400 million in liabilities to acquire Giant Eagle, a family-owned regional grocer with $9 billion in 2025 sales.
The deal adds 197 supermarkets and 11 standalone pharmacies across Ohio, Pennsylvania, West Virginia, Maryland, and Indiana, with closing expected in 2027.
Kroger CEO Greg Foran called the strategic fit clear, while critics have flagged antitrust risks and the potential for corporate layoffs.

Kroger announced on July 1 it had reached a definitive agreement to acquire Giant Eagle, a closely held regional grocery chain based in Pittsburgh. The $1.65 billion deal is Kroger’s first major acquisition since its $25 billion attempt to buy Albertsons collapsed in 2024.

The purchase gives Kroger 197 supermarkets and 11 standalone pharmacies operating in northern Ohio, western Pennsylvania, West Virginia, Maryland, and Indiana. Giant Eagle posted roughly $9 billion in sales last year, equal to about 6% of Kroger’s $147.6 billion in revenue during its most recent fiscal year.

Kroger plans to fund the acquisition with cash on hand. The company held approximately $2.9 billion in cash and temporary cash investments as of May 23. It expects to maintain its net total debt to adjusted EBITDA target range of 2.3 to 2.5 times after the deal closes, and said it will continue its share repurchase program and dividend.

Kroger CEO Greg Foran, who is leading his first major deal since taking the top role, said Giant Eagle fits Kroger’s core strengths. “Giant Eagle expands our reach into attractive adjacent markets, allowing us to do what we do best: run outstanding stores, deliver fresh foods and convenient meal solutions at affordable prices,” Foran said in a statement.

The deal carries meaningful strategic logic. Giant Eagle gives Kroger a strong foothold in the Pittsburgh metro area, where Kroger has historically had minimal presence. The acquisition also brings a pharmacy network and an established customer loyalty program, two assets grocery operators increasingly rely on to retain shoppers facing more choices than ever.

The combined company also enters a tighter race with Aldi. The German discount chain plans to open 180 stores in 2026 and is on track to surpass Kroger as the country’s second-largest grocery chain by store count. Adding nearly 200 Giant Eagle locations could help Kroger hold that position.

Antitrust scrutiny is expected. Kroger said it anticipates divesting a limited number of stores to satisfy regulators, without specifying locations. Columbus, Ohio, stands out as the most likely market for required divestitures. Kroger holds approximately 43% grocery market share there, and some Kroger and Giant Eagle stores sit on the same block.

The American Economic Liberties Project’s director, Morgan Harper, called the acquisition a power grab that will reduce competition and raise prices for consumers. Burt P. Flickinger III, managing director at Strategic Resource Group, pushed back, arguing Kroger has reduced prices by $250 million per year for 23 consecutive years, totaling nearly $5.75 billion in reductions.

Carol Levenson, director of research at Gimme Credit, said the deal stands a far better chance of regulatory approval than the Albertsons attempt. “Giant Eagle’s $9 billion in annual sales is dwarfed by Kroger’s $150 billion, and it owns fewer than 200 stores,” Levenson noted. She added that Kroger’s commitment to fund the deal with cash and maintain its leverage target makes the transaction financially manageable.

Jeffrey Inman, a retail researcher at the University of Pittsburgh School of Business, warned that corporate layoffs are a likely byproduct of the merger, as has been typical in similar grocery consolidations.

Kroger said it expects the acquisition to contribute to adjusted earnings beginning in the second full year after closing, placing the financial lift in 2029 at the earliest. Kroger’s board unanimously approved the transaction. Giant Eagle CEO Bill Artman said the deal positions the company to deliver better value and more growth opportunities for its team members.

Kroger’s stock dipped to $53.92 when the announcement hit before recovering to close above $56 on the day of the deal.