Amazon shakes up grocery aisles with $13.7b Whole Foods deal

Rodiano Bonacci
Giugno 19, 2017

It will take over a natural and organic grocer pioneer with 456 stores, a mecca for young, high-end shoppers, that has been struggling to rein in prices and integrate technology.

The post Amazon-Whole Foods Marriage Could Disrupt Grocery Business (NASDAQ:AMZN) appeared first on Market Exclusive. "It is a tsunami that will shake up and change grocery retailing. We believe it presents an incredible opportunity to take Whole Foods Market's mission and objective to new levels and will create significant value for our stakeholders - including you, our most loyal customers".

Amazon and Whole Foods Market, Inc. announced Friday morning that Amazon will buy Whole Foods for roughly $13.7 billion.

Shares of Amazon were trading at $988.52 in pre-market trading, a 2.53% jump, while Whole Foods shares were down 6.74% at $33.06.

He said that even if Amazon gets 20 million members of its Prime loyalty program to pay $15 a month extra for AmazonFresh grocery-delivery service, that's 20 million not going to traditional supermarkets.

The $42 a share offer from Amazon is a 27 percent premium over Whole Foods closing stock price on Thursday.

Perhaps the most tantalising aspect of this purchase is whether Amazon might make a similar move here in the United Kingdom and snap up a chain of supermarkets to further cement its toe-hold in the grocery market. State Street and Fidelity both have a substantial amount of shares in Whole Foods, as BBJ reported. And 24 percent of millennials bought something from Whole Foods previous year, compared with 20 percent of all consumers. Seen here is the Whole Foods store on Valencia Blvd.in Santa Clarita.

The company also has been testing sensors at a convenience store in Seattle to track items as shoppers put them into baskets or return them to the shelf.

Whole Foods Market is a leading natural and organic foods grocer, but has been widely known for high prices and under pressure from fierce competitions.

Drew Herdener, a spokesperson for Amazon, told The New York Times that Amazon has no plans to use this technology to replace the jobs of cashiers at Whole Foods, and no other jobs will be impacted as a result of the deal.

John Mackey will continue as chief executive of Whole Foods, and the company's headquarters will remain in Austin, Texas.

With a 9% stake, much of it accumulated relatively recently, Jana Partners was Whole Foods' second largest investor.

The deal is for $13.4 billion in cash and the remainder in debt.

Shoppers enter a Whole Foods Market, Friday, June 16, 2017, in San Antonio.

He sells hunting gear online and says Amazon pushes businesses to slash prices, so he's not making enough money to grow his company. It has expanded from a book seller into a merchant of almost all consumer products, as well as producing videos. According to multiple reports, Whole Foods also invested in Instacart. This deal gives Amazon a major foothold in that space.

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