MNA Science & Technology Desk: Amazon is going to acquire upscale US grocer Whole Foods Market, in a deal that underscores the online giant’s growing influence in the economy.
The purchase in one fell swoop gives Amazon, which until now has operated almost entirely on the internet, a big presence in the brick-and-mortar world on Main Street, with more than 450 stores in the US, Canada and Britain.
In the $13.7 billion, all-cash deal, Amazon will buy the Texas-based champion of organic and specialty food for $42 a share. Whole Foods’ shares traded in the mid-$30 range for May and early June.
The announcement had immediate and punishing consequences on Wall Street for retailers, such as Wal-Mart Stores, that sell groceries and are expected to face even tougher competition with Amazon now much more active in the space.
However, S&P placed Amazon on credit watch with negative implications on expectations the company will increase debt to finance the takeover.
Whole Foods will continue to operate stores under its brand and will continue to be led by co-founder and chief executive John Mackey, the companies said.