Saturday, June 17, 2017

Yesterday, e-commerce giant Amazon.com announced they are to acquire Texas based retail grocery store chain Whole Foods Market at US$42 per share. According to the deal worth US$13.7 billion (£10.7 billion) the retail grocery store chain is to keep the Whole Foods Market brand name and John Mackey is reportedly to remain its CEO.

After the announcement, Amazon’s shares went up more than two percent and Whole Foods Market shares went up by about 28%. Shares of other grocery-selling chains like Kroger, Target, Sprouts Farmers and Costco experienced a dip after the announcement.

Amazon runs their own online grocery — Amazon Fresh — which started a decade ago in Seattle, Washington. Amazon’s? CEO Jeff Bezos 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 started in 1978, and employs about 87000 people in its roughly 460 stores across the US, UK and Canada. The deal is expected to cover debts of Whole Foods Market.

Whole Foods Market CEO Mackey said, “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.”

The acquisition, which has not yet received approval from the shareholders of Whole Foods Market, adds a 27% premium to Thursday’s closing value of its stock. This would be Amazon’s largest acquisition if the deal is done.