Amazon has made a bid to buy Whole Foods in what would be a whopping $13.7 billion deal. The all-cash acquisition (which includes Whole Foods Market’s net..
Amazon has made a bid to buy Whole Foods in what would be a whopping $13.7 billion deal.
The all-cash acquisition (which includes Whole Foods Market’s net debt) , will radically shake up any number of businesses and completely changes the online retail and bricks and mortar landscape.
“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, Amazon founder and chief executive in a statement. “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 will continue to operate stores under its brand and will use its same vendors and partners around the world.
John Mackey will remain chief executive of Whole Foods the company’s headquarters will still be in Austin.
The deal, which is subject to approval of Whole Foods shareholders and regulators is expected to close in the second half of 2017.
The news, which was first reported by Bloomberg will have significant implications for any number of highly valued startup companies and the entire grocery industry.
Something else to chew over is the fact that Amazon now has access to a massive network of bricks and mortar businesses — although the fact that Whole Foods will retain its brand and its chief executive seems to indicate that (at least initially) the two companies will operate fairly independently.
Online sales of groceries grew by 15% over the last year to reach $48 billion, according to data from Kantar Worldpanel. By 2025 that number is expected to be $150 billion globally.
There’s no word yet on what the deal would mean for Amazon’s reported plans to launch convenience stores selling perishable goods and the drive-in, pick-up locations for grocery orders.
Late last year the Wall Street Journal reported on the company’s plan to expand its grocery reach beyond just Amazon Fresh.
That plan (reportedly called “Project Como” among staffers) was intended to be rolled out to Amazon Fresh service subscribers.
Amazon launched its grocery delivery service in 2007, but haltingly expanded the service in fits and starts. By June 2016 the service was only available in certain U. S. markets along the West Coast (Seattle and Northern and Southern California) , along with New York, New Jersey, Philadelphia, Stamford, Conn., Baltimore and Boston.
Internationally, the service was only available in London as of mid June last year.
