UPDATED - Amazon to buy Whole Foods Market in deal valued at $13.7 billion
Source: The Washington Post
By Washington Post Staff June 16 at 9:10 AM
The organic grocer would continue to operate under its existing brand. The deal is expected to close in the second half of 2017, pending shareholder and regulatory approvals.
This is a developing story. It will be updated.
Read more: https://www.washingtonpost.com/news/business/wp/2017/06/16/amazon-to-buy-whole-foods-market-in-deal-valued-at-13-7-billion/?pushid=5943d8c4658e691d00000056&tid=notifi_push_breaking-news&utm_term=.a7616484338d
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Amazon is buying Whole Foods for $13.7 billion
Myles Udland Yahoo Finance June 16, 2017
Amazon (AMZN) is buying Whole Foods (WFM) for $13.7 billion, the companies announced on Friday.
In a statement Friday morning, the online retailer said it would buy the high-end grocer for $42 per share, more than the $33.06 per share Whole Foods closed at on Thursday.
The deal is Amazons biggest deal ever, topping the $1.2 billion the company paid for online footwear retailer Zappos in 2009. In pre-market trading on Friday, Amazon shares were up slightly, rising about 0.9%. Whole Foods shares were halted for trade shortly after 9:00 a.m. ET.
Amazon CEO Jeff Bezos said, Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy. Whole Foods Market has been satisfying, delighting and nourishing customers for nearly four decades theyre doing an amazing job and we want that to continue.
John Mackey, the CEO of Whole Foods, will remain CEO of the company and its headquarters will remain in Austin, Texas. The companies expect the deal to close in the second half of this year.
more
https://finance.yahoo.com/news/amazon-buying-whole-foods-13-7-billion-130753335.html
IronLionZion
(45,458 posts)discounts for Prime members?
Fresh organic produce and meat will always be expensive. But much of their packaged stuff can be bought for much less at competitors.
CatWoman
(79,302 posts)Calista241
(5,586 posts)IronLionZion
(45,458 posts)where do you think lemongrass comes from?
kwassa
(23,340 posts)Achilleaze
(15,543 posts)and you get rock-bottom quality food, while the actual farmers get squeezed financially and are but cogs in a wholesale chemical industrial ruination of our soil and waters, to say nothing of our health. Industrial ag is - of all economic sectors - the greatest contributor to climate instability. So paying more for clean food brought to maturity in ways that enrich the soil, rather than deplete it, has in my view a lot of long-term wisdom in it.
BarbD
(1,193 posts)IronLionZion
(45,458 posts)And some folks can't afford the high prices at whole foods and have to find cheaper options.
janx
(24,128 posts)I love my local farmers' markets. I am also not into the marketing hype that tries to consume my grocery bill. I have been in circumstances more than once that prohibited my shopping at Whole Foods, and frankly, I regarded them as rich food snobs--or just stupid in reacting to the hype.
You should see the tomato plants that I bought from a local market about a month ago...tiny at the time, huge now.
IronLionZion
(45,458 posts)tomatoes are great from the farmers market or grown at home. I planted some in late May with tomato plant food and they are very tall now with several nice looking green tomatoes growing on them already. I planted cherry tomatoes this year and expect some success. I planted bush goliath last year and only got one.
DK504
(3,847 posts)As usual Bezos has a plan, I'd like to know what the plan is so maybe some stocks could be bought, but until he lowers prices they don't exist to me.
PunkinPi
(4,875 posts)just saw it advertised on Amazon this morning.
https://www.amazon.com/AmazonFresh/b?ie=UTF8&node=10329849011
herding cats
(19,565 posts)I see that changing in the near future.
Cha
(297,323 posts)found out about Amazon Fresh!
PPi
C Moon
(12,213 posts)IronLionZion
(45,458 posts)They also sing to the lemons as they grow and ripen on the tree. Happy lemons make for more delicious lemonade. Worth it!
C Moon
(12,213 posts)I was making reference to the commercial that shows Ice-T sitting next to some kids selling lemonade. People drive and walk by asking, "Is that Ice-T?"
He replies, "It's lemonade!"
"It's delicious! Try some!"
I probably should have spelled it differently.
IronLionZion
(45,458 posts)but it sounds like a good idea!
jalan48
(13,870 posts)christx30
(6,241 posts)that fill us up for $21 with tax. Has 4 thick slices of meatloaf, asparagus, and really good mac and cheese. Wife dishes it up, I microwave each plate. Got a whole assembly line thing going. If you're smart, you can get good deals there.
smirkymonkey
(63,221 posts)Certain things are very expensive there, but you can actually get some pretty good deals if you shop wisely. I have compared to other prices in some of the big name grocery chains in Boston and they are pretty much the same, but the quality isn't as good at the chains.
I mainly shop there because it is a very short walk for me and I don't drive. I only have to buy groceries for myself, so I never do too much damage.
christx30
(6,241 posts)has a parking garage directly under the store. You park, and take an escalator up to the store. Very convenient.
marlakay
(11,476 posts)We went to HEB store in Alamo Heights (think 1 %). The store was huge, as good as whole foods and half the price, and that neighborhood could afford it.
If Amazon did something like that store everyone would shop there.
I was shocked at how cheap everything was compared to natural store where i live.
hlthe2b
(102,294 posts)and given the two-hour prime delivery service available in Denver and several other US cities, this does make sense.
This is a pretty big deal, imo. Safeway, Krogers (King Soopers), and all the other traditional grocery stores are going to have quite a fight on their hands.
Flaleftist
(3,473 posts)that deliver groceries from various local stores in about an hour like shipt and instacart. So that may help a little. But given Amazon's popularity and ability to discount, competitors will definitely have to take notice and make changes.
Tommy_Carcetti
(43,182 posts)I like having the food literally in hand when I buy so I know what I pick out is good.
Only thing this makes sense for is for the elderly and incapacitated persons. Otherwise, it's just plain laziness.
hlthe2b
(102,294 posts)I only buy snack or edible items online if it is an item I have trouble finding.
Tommy_Carcetti
(43,182 posts)I've had too many experiences with wrong items being shipped or items not being shipped in general to leave it up to chance.
Online shopping is my last resort. Even behind my other last resort, Walmart.
Cha
(297,323 posts)for those who are incapacitated and/or elderly.. those who can't get to the stores.. it's wonderful!
christx30
(6,241 posts)She doesn't drive, but she's able to shop for groceries while I'm at work. She gets a few things so we're not in the car all the time. I hate going to the grocery store. I hate driving and I hate crowds of people, like with the passion of a thousand fiery nuns. It's the worst thing ever.
So if I can get a 3 liter of Dr. Pepper and a pack of paper towels delivered to my home, I'm happy about that.
Renew Deal
(81,863 posts)Whole Foods is really the only "national" supermarket so it makes some sense.
athena
(4,187 posts)I've been boycotting Amazon for years in protest of the way they treat their workers.
See:
https://www.nytimes.com/2015/08/16/technology/inside-amazon-wrestling-big-ideas-in-a-bruising-workplace.html?_r=0
https://www.thenation.com/article/how-crowdworkers-became-ghosts-digital-machine/
https://www.thenation.com/article/holiday-crush/
dalton99a
(81,516 posts)Given that Mackey's still in place.
I remember when his book came out seeing big cardboard cutouts of himself in WF stores, next to a big stack of his books.
Over the years I've shopped at WF the occasional employee has let slip to me what they think of him. Not good but often entertaining.
obamanut2012
(26,080 posts)BarbD
(1,193 posts)Like you, I have boycotted Amazon after reading how they treat their workers. It is becoming increasingly difficult to fight this battle -- I still try to buy local. Now, I have to consider the lesser of the evil. Where else can I buy Seventh Generation, or other organic brands?
athena
(4,187 posts)Try doing a Google search for health food stores in your area. I have one near me. They carry almost everything Whole Foods does.
I've found that Powell's and Biblio are excellent alternatives to Amazon.com for books. (You probably know this already, but others might not.)
Blazesweetie
(42 posts)I buy this brand at Target -- reasonably priced and with my Target credit card I get 5% off and free shipping if I buy online.
Blue_Adept
(6,399 posts)Some good expansion material in there as well. Be interesting to see what kind of integration it gets.
I've got none near me so it's fairly meaningless though the potential through online raises interest.
haele
(12,660 posts)They'll make it up in Amazon Fresh home delivery, though.
Haele
bucolic_frolic
(43,190 posts)Yesterday ALDI's, the German discount chain announced expansion plans here in the US.
Something like adding 800 stores by 2022. The news hit KR Kroger and SVU Supervalu, our
two US food and distribution chains, hard. WMT is also lowering prices.
I don't know how these high price chains keep growing. WFM? How about Ahold (Giant)?
I see regional chains in my area being clobbered by ALDI and WMT. And don't find WMT
particularly cheap.
QED
(2,747 posts)I'd love to see more of them.
kwassa
(23,340 posts)Aldi Nord owns Trader Joe's.
Aldi Sud owns the Aldis in the US. The two Albrecht brothers that created the chains divided the world up between their different stores.
obamanut2012
(26,080 posts)With the rest at Aldi's, and some occasional stuff from Publix and Whole Foods.
haele
(12,660 posts)Fresh and Easy didn't do too well locally, even though their prices were reasonable and selection was decent. The volume of sales didn't make up for the costs to put some of the stores in place, and some of their locations were not public transportation friendly.
They really have to do demographic and traffic pattern studies on the locations before they drop a store there. What may seem to be a good location may be too inconvenient or unsafe for a lot of the locals to get to, especially in low income food deserts.
Haele
bucolic_frolic
(43,190 posts)it makes every investment project look profitable
There's a mighty shakeout coming in the food business, and no firm will be unscathed
My local town of about 18,000 has 7 companies selling groceries in eight locations,
4 of them discount plus one Big Box and three conventional supermarkets
Several are stagnating and competing by raising prices. How does that usually go?
haele
(12,660 posts)The stores that did well were primarily located in dense residential areas that made them either walkable or near public transportation. The other factor was local competition/saturation; success was only present where there was pretty much only convenience store or smaller, more boutique stores nearby, instead of big grocery chains and strip malls.
The closest F&E near us has now become a Barron's - a boutique/organic/locavour-type grocery chain with very good prices on local fresh produce and their "ready to eat" in-store packaged healthy meals/salad-bar/deli selection to get locals in the door. Which is a good match to the more middle income, older dense residential housing North Park area that only has one major grocery store and a large bodega within a three mile radius. They aren't a large store, but it's mostly "good" food (and, well, a large craft beer and wine section), and if you need kitchen and bath sundries, there's both a CVS and a Walgreen's across the street.
BTW, if you're in San Diego County, and liked the old Henry's stores before they turned into Wild Oats/Sprouts, check out the Barrons stores...there's only seven, and they aren't as big as the old Henry's, but there's a similar cost savings on produce and healthy foods.
Haele
bucolic_frolic
(43,190 posts)Most locations look profitable with marginal or uncertain demographics because
the cost of capital is zilch, and growth projections almost infinite. But when the
populations don't migrate to your location, it's red ink
TexasBushwhacker
(20,202 posts)Considering the quality. I do think that large qty items are cheaper, but the regular sized items I would buy as a single person are as much or more as other stores. And nothing is more aggravating than 30 checkout lanes and only 2 have cashiers. I've abandoned my cart a few times. They skimp on the A/C too and the stores are sweltering in the summer.
Auggie
(31,174 posts)I don't think Mackey wanted to sell.
Just yesterday (Thursday) The Motley Fool reported Whole Foods stock had been "slammed" and that "activist investors" Jana Partners (Mackey called them "Greedy Bastards" had been pushing for a sale of the company.
Whole Foods shares closed at $33. Company sold at $42. Bingo.
According to Investopedia, "Jana Partners is an activist hedge fund founded by Barry Rosenstein in 2001. The fund specializes in event-driven investing by applying a fundamental analysis to identify undervalued companies in the market. Based in New York, the fund manages around $10 billion as of 2015."
Well, apparently no one got hurt except Mackey's ego (screw him anyway) and I guess it'll be business as usual at Whole Foods, albeit with probable online ordering and delivery service via Amazon.
Rosenstein was worth $1.3 billion yesterday and a lot more today.
Links:
https://www.fool.com/investing/2017/06/15/why-whole-foods-market-inc-stock-got-slammed-today.aspx
http://www.investopedia.com/articles/markets/020316/jana-partners-activist-investor-analysis.asp
JaneQPublic
(7,113 posts)WaPo is doing better than it has in years, both in terms of quality reporting and its profitability.
Perhaps AMZ will do as well with WFM.
Galileo126
(2,016 posts)Whole Paycheck is dead!
Javaman
(62,531 posts)I'm glad you are laughing.
she's a trench worker. we need her income.
hope you are still laughing.
real people, not just the douchebags that run the business, are actually effected by this in a very negative way.
we are now worried about her job.
EllieBC
(3,016 posts)Kind of sickening how people losing jobs is hilarious to some on our side, isn't it? :/
The empressof all
(29,098 posts)It looks like MacKey will be staying on as CEO so that would indicate things will remain status quo for the near future. The Amazon Go systems are still in Beta and only recently opened to the general public. Even when they are installed they will still need staff to stock and monitor the operations. Yes eventually cashiering functions will disappear and each location will be able to operate with less staff. Honestly it is going to happen not just at Whole Foods but with all major chains. Cashiering will go the wayside like keypunch operators and coal miners . So while you have no immediate cause for concern...In the long run she needs to start positioning herself for management, stocking or customer service rolls. I'm sorry..... But you know there may be some changes implemented that may not be horrific and could benefit her. It's scary when these kinds of institutional changes occur...
suffragette
(12,232 posts)system.
Now it will have a whole chain of stores to push and promote that system, which it can then license to other stores.
I hope that's not the path this takes, but I sadly think it is likely.
still_one
(92,222 posts)Iplayoneontv
(77 posts)That would lay off a lot of people with decent pay for the average skill level. That's my only worry. Otherwise, I'm fine with this.
DinahMoeHum
(21,794 posts). . .that CEO John Mackey is employing against a particular hedge fund called JANA Partners. . .
http://www.salon.com/2017/06/16/amazon-whole-foods-aquisition/
(snip)
Agreeing to be bought out by Amazon. . . makes sense in light of the fact that Whole Foods recently became the target of hedge fund JANA Partners, known for its aggressive approach to asset management and its efforts to force companies it purchases stock in to make drastic changes such as spinning off divisions. John Mackey, the supermarket chains CEO and co-founder denounced the group as greedy bastards in an interview with Texas Monthly that was published this week.
These people, they just want to sell Whole Foods Market and make hundreds of millions of dollars, and they have to know that Im going to resist that, Mackey was quoted by the magazine as saying. Thats my baby. Im going to protect my kid, and theyve got to knock Daddy out if they want to take it over.
(snip)
http://features.texasmonthly.com/editorial/shelf-life-john-mackey/
Mosby
(16,319 posts)If they increase their store footprint they could be competitors.
As it is they are taking business away from WF, TJs, and the traditional G-stores like Fry's (kroger) Safeway, etc.
joshcryer
(62,276 posts)Expect every whole foods to employ such technology.
Response to DonViejo (Original post)
Name removed Message auto-removed
uppityperson
(115,677 posts)TexasBushwhacker
(20,202 posts)I liked it for a while, but was part of a 50 person lay off when they decided to close one of the warehouses at their distribution center in Austin. Then things got very weird. We were given 3 months notice and decent severance, but suddenly everyone started getting written up for bullshit reasons. I was on final notice, but I found out almost everyone else was too. My guess is they were trying to fire as many people as they could to get out of actually paying the severance and unemployment. Fuckers.
But I think this could be good for both parties. Amazon would get brick and mortar stores and Whole Foods could take another stab at online retail. They lost their shirt the first time.
mvd
(65,174 posts)the lack of variety there would make it nice if Amazon could make Whole Foods an option for me. Have to make sure they don't automate too much and hurt workers.