Shares in both companies surged in early trading Friday after Fast Company reported the two were discussing a deal, citing several people with knowledge of the matter.
The report said the two companies first started discussing a partnership last summer, but decided to “a merger is the best path forward.”
Target shares were up 3 percent in Friday’s premarket session, while Kroger stock rose 8 percent initially on the report.
The two have had meetings over a Shipt partnership, the source did tell CNBC.
Kroger and Target did not immediately respond to requests for comment.
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