In a surprise move sure to send ripples through the aisles of retailers around the world, Amazon and Whole Foods Market today announced that they have entered into a definitive merger agreement under which Amazon will acquire Whole Foods Market for $42 per share
in an all-cash transaction valued at approximately $13.7 billion, including Whole Foods Market’s net debt. The move puts the online leviathan squarely in the business of bricks and mortar retailer and opens intriguing possibilities for dramatic private brand expansion. Whole Foods branded product available on Amazon should make the folks at Kroger more than a little nervous about the continued growth of Simple Truth and its implications for the rest of their shoppers basket.
IN a press release announcing the deal Jeff Bezos, Amazon founder and CEO said “Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy, 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.”
“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,” said John Mackey, Whole Foods Market co-founder, and CEO.
Whole Foods Market will continue to operate stores under the Whole Foods Market brand and source from trusted vendors and partners around the world. John Mackey will remain as CEO of Whole Foods Market and Whole Foods Market’s headquarters will stay in Austin, Texas.
Completion of the transaction is subject to approval by Whole Foods Market’s shareholders, regulatory approvals, and other customary closing conditions. The parties expect to close the transaction during the second half of 2017.
This acquisition combined with yesterday’s opening of Lidl stores in the southeast points to the beginning of a dramatic era of evolution and revolution in retail and private brand that will define the future of our business.