Whole Foods acquisition gives Amazon almost as many stores as Apple

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Whole Foods will soon become an Amazon subsidiary.
Whole Foods will soon become an Amazon subsidiary.
Photo: Whole Foods

Amazon is coughing up a whopping $13.7 billion in cash to acquire Whole Foods Market.

The two companies will merge but Whole Foods stores will continue to operate independently, with co-founder John Mackey retaining his role as CEO. The move instantly gives Amazon almost as many stores as Apple.

Amazon’s push into the grocery market came in 2007, when the retail giant launched AmazonFresh. Its acquisition of Whole Foods greatly expands its food business, and serves customers who cannot wait for goods to be delivered to their home.

“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 Amazon CEO Jeff Bezos. “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.”

Whole Foods ranked number 28 on Fortune’s list of World’s Most Admired Companies for 2017. Amazon is paying $42 per share in an all-cash transaction for the company, which is 27 percent higher than the closing price on Thursday. It’s Amazon’s largest acquisition since it purchased Zappos, an online clothing retailer, for around $1.2 billion in 2009.

The deal is expected to be completed during the second half of this year. Mackey is keen to stress that it is a “partnership” as opposed to a complete takeover, and Whole Foods stores will continue to operate as normal. The company’s headquarters will remain in Texas.

“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,” Mackey said.

Although Whole Foods will carry on as normal, we will almost certainly see its products available through AmazonFresh, while devices like the Kindle, Fire tablets, and Echo speaker will likely be popping up in Whole Foods stores.

Whole Foods currently operates around 456 stores worldwide, according to the latest data from Statista, while Amazon owns several of its own locations, including a bookstore in Seattle. In comparison, Apple boasts 496 stores across 21 markets. Whole Foods announced the closure of nine locations back in April following its sixth consecutive quarter of declining sales.

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  • Grits n Gravy

    More like millions of people aren’t smart enough to get better food at their local market or Trader Joe’s and not hand over their whole paycheck for big box organic.

    But good for Amazon,makes them huge in the grocery space with a large amount of stores. If they can turn around Whole Paycheck into a decent brand then this will be big.

    • CelestialTerrestrial

      Umm.. Whole Foods has a way better meat section, and they have a bigger variety of better quality food. When I go to Trader Joe’s, I end up not buying much because most of it is cheap crap. they have some decent stuff, but most of it just a bunch of frozen food, a piss poor produce. Sorry, but Whole Foods has better quality foods. Yeah, I know they are pricey, but sometimes they actually have decent prices. I like quality not cheap prices. That’s the difference.I have been to a better grocery store, but they only have 2 locations and I live a good 2 1/2 hour drive, so it’s not convenient. The place is called Berkeley Bowl. The place is freaking HUGE. I can’t comment on their prices because it’s been a while since I’ve been there, but it’s by far the biggest selection of foods I’ve seen and it’s all excellent quality.

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