Amazon buys Whole Foods for $13.7 billion
With its largest acquisition ever, Amazon has truly hit a home run, expanding into the large supermarket arena. The American e-commerce giant purchased the Whole Foods Market chain for $42 a share as part of a deal worth $13.7 billion, including the retailer’s net debt.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” said Jeff Bezos (pictured), Amazon’s CEO. He emphasized that the supermarket chain is “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, CEO of whole Foods. Mackey will stay on in his current role and will continue to manage the supermarket chain under the same name. The headquarters will remain in Austin, Texas.
The transaction, which is expected to close in the second half of 2017, must be approved by Whole Foods Market shareholders and regulatory authorities. Based on the terms of the agreement, Whole Foods will have to pay Amazon a penalty of $400 million if they decide not to go through with the acquisition.
Whole Foods is a supermarket chain with $15 billion in sales, with locations in the U.S., Canada and the United Kingdom. It is specialized in natural and organic products. It was founded in Austin in 1980 and has become the top company focused on the distribution of organic products in the United States, though in recent semesters, it has seen a drop in sales.
According to the American financial publication Bloomberg, this acquisition is going to shake up the entire industry, breaking down the walls between electronic commerce and brick-and-mortar stores selling products at the ready.