Amazon to Buy Whole Foods Market for $13.7 Billion
Online shopping powerhouse Amazon.com Inc.--based in Seattle, WA--announced today plans to buy Austin, TX-based Whole Foods Market Inc. in a $13.7 billion cash deal.
Offering a rather upscale shopping experience, Whole Foods’ popularity and prevalence has grown tremendously over the years as consumers seek out more organic, natural and nutritious food choices. However, such a particular selection of foods became too pricey, especially for picky and budget-conscious millennials. Competitors began emulating Whole Foods’ style, but they sell virtually the same fresh goods for much lower prices. This fierce competition--coupled with a falling stock price--is believed to be the impetus for the grocery chain’s sale.
Jeff Bezos, Amazon’s CEO says, “Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy. They’re doing an amazing job and we want that to continue.”
With this acquisition, Amazon’s technology expertise is expected to have a major impact on consumers’ grocery shopping experience--both online and in-person. The website already offers an online grocery delivery service known as AmazonFresh, but the purchase of Whole Foods is expected to greatly amplify that service’s existing presence in the market. Other retailers such as Walmart and Target have already been performing well in the grocery sector.
Under the deal, Whole Foods will keep its name, along with its Austin headquarters and CEO.
Despite today’s announcement, the deal still needs to undergo approval by shareholders and regulators. The acquisition should be complete later this year.
Whole Foods Market operates 460 stores in the U.S., Canada and in Britain.