Mario Tama
Update 9:30pm: Adds link to copy of temporary restraining order.
A Washington state judge granted a temporary restraining order blocking payment of Albertsons (NYSE:ACI) dividend in connection with its planned sale to Kroger (NYSE:KR). Albertsons rose 5.2% in after hours trading.
Albertsons dividend was temporarily blocked by a Washington judge, according to a copy of temporary restraining order. The dividend was set to be paid on Monday.
The next hearing on a potential preliminary injunction is set for Nov. 10 in Washington state.
Multiple state attorney general’s have filed a joint suit against Albertsons (ACI) to block a $4B special dividend announced alongside its plans to merge with Kroger (KR). The joint suit joins a previously announced suit from Washington state Attorney General Bob Ferguson, which was announced on Tuesday.
The suit in Washington accuses the two companies of violating antitrust and consumer protection laws and seeks to block the payment to shareholders on these grounds.
“Huge victory! Putting the brakes on this $4 billion payment is the right thing for Americans shopping at their local grocery store,” Washington state Attorney Genera Bob Ferguson said in a statement late Thursday. “Thanks to my team for their usual excellent job holding powerful interests accountable.”
Albertsons (ACI) didn’t immediately respond to Seeking Alpha email request for comment.
Washington D.C., California, Illinois attorneys general jointly announced Wednesday hey have sued the grocery chain on the grounds that it would hurt union employees, consumers, and the ability of the company to operate with a lower cash balance.
Last Wednesday a bipartisan group of state attorneys generals called for the special dividend be stopped. Albertsons responded to these requests in a letter stating that the dividend had been planned prior to the merger discussions.
Image and article originally from seekingalpha.com. Read the original article here.