Amazon has agreed to acquire grocery chain Whole Foods for an estimated $13.7 billion deal. Amazon will pay $42 a share in cash for the organic-food chain, the companies said today. John Mackey, Whole Foods’ co-founder and CEO, will continue to run the business.
According to Crain’s Chicago Business, Whole Foods has been under pressure to find a buyer when investor Jana Partners acquired a stake and began pushing for a sale. The sale to Amazon allows him to maintain his position as CEO and gives Amazon a further reach into the grocery business.
“Amazon clearly wants to be in grocery, clearly believes a physical presence gives them an advantage,” said Michael Pachter, an analyst at Wedbush Securities. “I assume the physical presence gives them the ability to distribute other products more locally. So theoretically you could get 5-minute delivery.”
Source: Crain’s Chicago Business