With Whole Foods, Amazon on collision course with Wal-Mart

Dianna Christensen
June 27, 2017

Online retail giant Amazon announced on Friday that it had reached a definitive agreement to acquire Whole Foods Market for $13.7 billion.

Completion of the transaction is subject to approval by Whole Foods Market's shareholders, regulatory approvals and other customary closing conditions.

Whole Foods will keep operating stores under its name and John Mackey will stay as CEO, with headquarters in Austin, Texas.

Inc. will pay $42 per share of Whole Foods Market Inc.

"We want to assure you that Amazon shares Whole Foods Market's deep commitment to quality and customer service".

The Journal said buying Whole Foods allows Amazon to quickly grab a bigger portion of the estimated $674 billion USA market for edible groceries, according to consulting firm Kantar Retail. Meanwhile, the more than 460 Whole Foods stores in the U.S., Canada and the United Kingdom could be turned into distribution hubs - not just for delivering groceries, but also as pickup centers for online orders.

Remember that futuristic grocery store Amazon was testing in Seattle?

Amazon, started in Seattle in 1994 by Bezos, a former hedge fund manager, has grown into the world's biggest diversified online retailer, with a market capitalization of almost $500 billion. This is an important question because those fees combined may account for more revenue on an order than the commission paid by Whole Foods. Earlier this year, Oppenheimer valued Whole Foods in the mid $40-range in a possible buyout.

Khloe Kardashian's Surprise 33rd Birthday Party Made Even Kanye Smile
Trying to convince Khloe that she was being genuine, Kanye West's wife said that it would mean "everything" to her. The Cleveland Cavaliers star already has a six-month-old son named Prince with ex-girlfriend Jordan Craig .

Company Curbs Sale of Panels Used on Burned London High-rise
Arconic stressed in a statement that its panels were just part of the cladding system and that it did not supply the insulation. The council has no plans to fit external cladding on any new council residential buildings now in development.

Blake Griffin opts out, becomes free agent
Griffin, 28, has one year remaining on a five-year deal that would see him earn roughly $21.3 million for the 2017-18 campaign. And the? Spurs?have indeed explored the feasibility of making a free-agent run at Paul, league sources told ESPN last month.

"Amazon could bring technology to all Whole Foods locations, or it could absorb Whole Foods into AmazonFresh".

The supermarket chain will continue to operate stores under the Whole Foods Market brand.

PCC has also partnered with its competitor, offering delivery through Amazon Prime Now since April previous year. "We believe it presents an incredible opportunity to take Whole Foods Market's mission and goal to new levels and will create significant value for our stakeholders - including you, our most loyal customers".

By joining forces with Amazon, Whole Foods gains access to an entirely new distribution channel - which should be good news for anyone hoping to shop for organic kale online.

Instacart declined to comment, but multiple reports said Whole Foods makes up less than 10 percent of Instacart's business. "Amazon has moved squarely onto the turf of traditional supermarkets and poses a much more significant threat".

The "implications ripple far beyond the food segment, where dominant players like Walmart, Kroger, Costco, and Target now have to look over their shoulders at the Amazon train coming down the tracks", O'Shea said.

The S&P 500 market capitalization loss for just 20 stocks in the retail and food sector was $37.7 billion by Friday afternoon, according to CNBC. The merger offers a test of whether Amazon, which has generally built its business on low prices, can successfully integrate a grocer known for premium service and higher prices.

There's also the "grocerant" trend - a blending of grocery stores and restaurants.

Other reports by GlobalViralNews

Discuss This Article

FOLLOW OUR NEWSPAPER