Amazon.com, Inc. AMZN on Friday announced its $13.7 billion acquisition of Whole Foods Market, Inc. WFM, a $42-per-share transaction pending approval by the target’s shareholders. The deal is expected to close in the latter half of 2017.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” Jeff Bezos, Amazon founder and CEO, said in a press release. “Whole Foods Market has been satisfying, delighting and nourishing customers for nearly four decades – they’re doing an amazing job and we want that to continue.”
Amazon has been slowly breaking into the fresh food scene with its automated grocery warehouse, online ordering and delivery platform, and neighborhood grocery trucks.
“This partnership presents an opportunity to maximize value for Whole Foods Market’s shareholders, while at the same time extending our mission and bringing the highest quality, experience, convenience and innovation to our customers,” John Mackey, Whole Foods Market co-founder and CEO, said in the announcement.
From the outside, it appears little will change in Whole Foods operations, with Mackey retaining his role in the company’s Austin headquarters and management preserving its store brand and cohort of vendors.
"Amazon did not just buy Whole Foods grocery stores. It bought 431 upper-income, prime-location distribution nodes for everything it does," Wall Street Journal Editor Dennis Berman Tweeted.
Grocery competitors Kroger Co KR shares plunged 28 percent on the news, while Wal-Mart Stores Inc WMT fell nearly 5 percent.
At time of publication, Amazon was trading up 1.2 percent and Whole Foods stock was halted.
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