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Amazon to Acquire Whole Foods For $13.7 Billion

By NexChange
Capital Markets

Amazon is acquiring Whole Foods for $13.7 billion, the companies announced on Friday.

The companies said in a press release that Amazon will acquire Whole Foods for $42 per share in an all-cash transaction. The acquisition represents the biggest deal for Jeff Bezos’ e-commerce behemoth, Bloomberg reports.

“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,” John Mackey, Whole Foods Market co-founder and CEO, said in a statement.

Mackey founded the Austin, Texas-based Whole Foods in 1978. He will remain chief executive of the company.

The acquisition comes at a time of significant uncertainty for Whole Foods’ business. A Barclay’s analyst wrote in a note a couple of months ago that the high-end grocery chain is bleeding traffic at a “staggering” rate as it faces stiff competition from competitors, most significantly Kroger.

Karen Short, the Barclay’s analyst, noted that Whole Foods’ customer traffic has declined by 3 percent. “A 3% traffic decline may not seem like much, but this equates to 14 [million] customers,” Short wrote.

Meanwhile, Whole Foods’ stock has lost nearly half its value since its 2013 peak, according to the Wall Street Journal.

Photo: Getty iStock

 

 

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