These Reactions To Amazon's Acquisition Of Whole Foods Say It All

Amazon to buy Whole Foods for $13.7 billion

Amazon Is Set To Make Its Biggest Purchase Ever

Days after it came to light that he had lambasted activist investors as "greedy bastards", Whole Foods CEO John Mackey has struck a deal that will net one such investor a massive payday.

Amazon has agreed to pay $42 per share in cash for Whole Foods, a 27 percent premium on the Austin, Texas-based grocer's closing share price on Thursday. "Whole Foods Market has been satisfying, delighting and nourishing customers for almost four decades - they're doing an incredible job and we want that to continue".

The transaction is expected to close in the second half of 2017 following regulatory approval and a Whole Foods shareholder vote.

For instance, Amazon has used its position as the shopper-consideration starting point to elevate its private labels on Amazon searches and shopper inquiries on Alexa.

Whether you're in the grocery business or not, the internet always has something to say about mergers of this scale.

Amazon already offers grocery-delivery services in five markets, but the Whole Foods purchase would let it expand to many more. At the same time, Amazon looks to be just the partner Whole Foods needs to turn its fortunes around.

The company has experimented with fresh food delivery for years with Amazon Fresh.

Retail grocery stores have been hit hard by the news, with Kroger Co (NYSE: KR) falling almost 12 percent, as grocers will obviously struggle to keep up with Amazon's low prices.

Analyst Chris Low at FTN Financial joined us to talk about the state of the supermarket industry, what the sale could mean for your shopping experience, and whether Amazon has what it takes to turn Whole Foods around.

The deal, which not only helps Amazon make deeper inroads into the grocery sector but also marks its big entry into the brick-and-mortar retail space, sent shock waves through the retail industry.

The company also has been testing sensors at a convenience store in Seattle to track items as shoppers put them into baskets or return them to the shelf.

Amazon could have built up its groceries business without acquisitions, but that would have been costly and time-consuming, said Neil Saunders, managing director of GlobalData Retail.

More than 57 percent of Target's regular customers use Amazon's Prime membership program, according to consultancy Magid Associates, compared with 42 percent of all consumers.

When it raised $400 million in March, Instacart said it operated in 35 markets and had 135 partnerships with grocery retailers around the country.

Now they're clearly facing another big leadership change with Amazon - which has a reputation for having both innovative and harsh working conditions.

Whole Foods Market's share price rose more than 29% on Friday. Whole Foods Market will also still operate under the same brand.

Not anymore. In one fell swoop, Amazon founder Jeff Bezos has bought his way into the supermarket business with the $13.7 billion acquisition of Whole Foods.

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