Amazon Buys Whole Foods Costing $13.7bn

Amazon Buys Whole Foods Costing $13.7bn
Share on facebook
Share on twitter
Share on whatsapp
Share on facebook
Facebook
Share on twitter
Twitter
Share on whatsapp
WhatsApp



United States (Mckoy’s News) – Amazon Buys Whole Foods Costing $13.7bn: Online retail giant Amazon is buying Whole Foods in a $13.7bn (£10.7bn) deal that marks its biggest push into traditional retailing yet.

Amazon, which has been experimenting with selling groceries, will buy the upmarket supermarket for $42 a share.

Investors greeted the deal as game-changing for the industry, sending shares of rival grocers plunging.

But Whole Foods, which had been under pressure, climbed.

Founded in 1978 in Texas, Whole Foods was a pioneer of the move towards natural and organic foods.

It has grown to more than 460 stores in the US, Canada and the UK, and employs about 87,000 people.

Amazon founder and chief executive Jeff Bezos said: “Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy.”

“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.”

Amazon Buys Whole Foods Costing $13.7bn

Amazon Buys Whole Foods Costing $13.7bn

‘Maximise value’

Whole Foods has faced dissatisfaction from investors, amid falling same-store sales and increased competition. Last month, the company named a new chief financial officer and new board members.

In April, activist investor Jana Partners called the firm’s shares undervalued, noting “chronic underperformance”.

The price being paid by Amazon marks a 27% premium to the level Whole Foods’ shares closed at on Thursday. The $13.7bn value includes assumption of the grocer’s debt.

The takeover deal is expected to be completed in the second half of the year, pending approval by shareholders and anti-trust regulators.

Whole Foods boss John Mackey said: “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.

The Whole Foods brand will continue. Mr Mackey is expected to stay on as chief executive.

‘Inherent logic’

Whole Foods stock immediately soared almost 27% on the news.

Amazon climbed 3.4%.

Neil Saunders, managing director of GlobalData Retail, said the deal should give the grocer financial breathing room, while making it more competitive online and improving its supply chain logistics.

The takeover also makes Amazon an instant player in the grocery industry, which it has been eying for some time.

There is an inherent logic in the move which, in our view, brings benefits to both businesses,” Mr Saunders wrote, describing Amazon as a “white-knight” that has come to the grocer’s rescue.


Contribution by Dr. Colin O Jarrett

Send us your feedback, news items, community sports or events, real life stories, Dear McKoy, photos and/or videos to WhatsApp 1-876-353-1389 Or Email [email protected]

Great Ads Deal – Advertise With Us

2020 Break out artist on the rise

Related Posts

Recent Posts

2020 Break out artist on the rise