Amazon announced Friday that it will acquire Whole Foods Market for $42 per share in an all-cash transaction valued at approximately $13.7 billion, including Whole Food’s net debt.
Plans for how Amazon plans to integrate Whole Foods’ cutting-edge organic and natural products and reputation for presenting innovative products to consumers into the e-commerce giant’s existing dominance in other retail categories were not announced. The announcement also left open Amazon’s own, multi-faceted push into grocery, which includes both brick-and-mortar and online strategies.
Whole Foods brick and mortar stores will remain open. John Mackey will remain as CEO of Whole Foods Market and the company’s headquarters will remain in Austin, Texas.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” said Jeff Bezos, Amazon founder and CEO, in a press release. “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.” E-commerce has led to massive declines in retail purchases throughout all product channels in the past decade. In a widely cited report on the future of grocery in e-commerce, the Food Marketing Institute and A.C. Nielsen predicted that 20 percent of all grocery purchases — more than $100 billion — will move online by 2025.
Awaiting approval from Whole Foods Shareholders, the acquisition is expected to be completed during the second half of 2017.