By Mike Scarcella
(Reuters) -Washington's state supreme court on Friday blocked Albertsons Companies Inc from paying a special dividend ahead of its acquisition by Kroger (NYSE:KR) Co, a court order showed.
The court extended a block put in place by a lower court, and said the block would remain in place until a further order of the court.
"The State of Washington Supreme Court has continued the temporary restraining order against the company’s previously announced special dividend while the Washington Supreme Court considers if it will hear the state’s appeal," Albertsons said in a statement.
The U.S grocery chain has filed a motion to expedite the Washington Supreme Court’s review, according to the statement.
Earlier in December, Albertsons said Washington State Court had denied a request of preliminary injunction by the state's Attorney General to prevent the company from paying $4 billion to shareholders in a special dividend.
Kroger snapped up Albertsons in a $25 billion deal in October, in a mega merger between the No. 1 and 2 standalone grocers, saying the deal would help it better compete against U.S. grocery industry leader Walmart (NYSE:WMT) Inc on prices.
The planned acquisition has come under sharp criticism on antitrust grounds.