Amazon.com announced today that it will acquire Whole Foods Market for $13.7 billion. According to Reuters, this is Amazon’s largest foray yet into the brick-and-mortar retail sector.
The transaction is expected to close in the second half of 2017. Whole Foods says it will continue to operate its stores under the Whole Foods Market brand and source products from its “trusted vendors and partners around the world.”
According to Reuters, “The deal, which puts a 27% premium on Whole Foods' closing share price on Thursday, would could give the grocer a major competitive edge by allowing it to tap into Amazon's massive power to buy and sell goods at a lower cost.”
John Mackey, Whole Foods Market co-founder and CEO, will remain CEO of Whole Foods Market, and the company’s headquarters will remain in Austin, TX. Mackey said in a press release, “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.”
Completion of the transaction is subject to approval by Whole Foods Market's shareholders, regulatory approvals, and other customary closing conditions. The deal would be an all-cash transaction that includes Whole Foods’ net debt.