Inc said it would buy Whole Foods Market Inc in a deal valued at about $13.7 billion, including debt. Amazon.com Inc. will pay $42 per share of Whole Foods Market Inc.
Pressure from activist investors got so high that Whole Foods CEO John Mackey told Texas Monthly magazine recently that "they're greedy bastards, and they're putting a bunch of propaganda out there, trying to destroy my reputation and the reputation of Whole Foods, because it's in their self-interest to do so". The deal is expected to close during the second half of the year.
Apparently, investors in the "healthy" grocery chain have not been happy with its performance and encouraged them to sell or merge with another chain.
The acquisition ramps up Amazon's stake in the global grocery market following its launch of AmazonFresh, which entered the United Kingdom market past year.
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We've sent a message to Amazon asking whether the company plans to include Whole Foods in its same-day delivery and drone service plans.
Amazon is always looking to expand its business and now they've purchased Whole Foods which could ramp up online grocery sales. Customers order online and the items are picked from the store closest to the address and delivered. Walmart, which has the largest share of the USA food market, has been working on lowering prices, while Target has been struggling to turn around its grocery business.
Recent reports had suggested Whole Foods as a candidate for takeover by a traditional grocer like Kroger Co. Walmart has touted synergy between physical and virtual retailing capabilities - particularly in food - as a competitive advantage.
In April, activist investor Jana Partners announced it had bought almost 9 percent of Whole Foods' stock and was reportedly hoping the grocer would make changes to boost its value. Industry observers in the meantime had argued Whole Foods would be better off as a private company.
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