Amazon is planning to buy Whole Foods for $13.7 billion in cash. The purchase is expected to take place sometime later today. Amazon will pay $42 a share in the massive transaction to buy the chain of organic and healthy food markets.
All of Whole Foods’ debt will be assumed by Amazon as a part of the deal. The purchase is not anticipated to close until the second half of this year. In the meantime, Whole Foods will continue operating its markets around the United States.
Whole Foods co-founder John Mackey will retain his position as the CEO of the store chain and work out of the company’s headquarters in Austin, CNN Money reports. The business was created in the Texas city in 1980.
“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 CEO said in a media release shared by the Daily Mail.
Whole Foods halted shares of the grocery store chain today while preparing for the news of the sale to Amazon to be released. Stock prices for the chain closed at $33.06 on Thursday. Amazon’s stock prices rose significantly in pre-market trading as soon as news about the pending purchased surfaced.
— Daily Hive Montreal (@DailyHiveMTL) June 16, 2017
Amazon stock prices closed at $964.17 on Thursday. The shares rose by more than three percent early Friday morning.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” Amazon Jeff Bezos said in a prepared 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.”
— Bloomberg (@business) June 16, 2017
The Amazon purchase of Whole Foods may indicate a willingness by the online retail giant to begin conquering the brick-and-mortar store industry as well. Many long-time and previously successful retail chains have been crippled by the popularity and growth of Amazon and closed stores around the country.
Amazon already operates its own online food delivery service, AmazonFresh. The company has begun experimenting with a “click and collect” system that would allow customers to purchase their groceries online and then pick them up at a location in their area. Both Walmart and Kroger also have launched a limited-location curbside grocery pickup system in recent months.
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