In what is only expected to rock the grocery world, Amazon Inc. has agreed to buy Whole Foods Market.
For $42 a share, the deal is worth $13.7 billion dollars. John Mackey, the current CEO of Whole Foods, will stay on as the CEO. The stock market is already seeing the ramifications of such a large buy-out.
Whole Foods’ career started strong as in the beginning they were the only grocery store of its type, offering the healthiest of choices. Quickly thought other grocery chains caught on a began selling natural foods at a fraction of the price, which is something Whole Foods has been criticized over. They earned the nickname “whole paycheck” referring to how customers spend a large amount of money on their products.
The deal comes at time of huge growth within the company, as they race to keep up with other large superstores such as Walmart. Walmart recently introduced free two-day shipping policy rivaling Amazon, as customers do not need an annual membership. But Amazon continues to dominate as a global leader in the retail sector as they have been experiencing with AmazonFresh, a delivery service, as well as offering discounted memberships to customers on government assistance because they declare a membership is not a luxury but a necessity.
In a statement, Mackey said "This partnership presents an opportunity to maximize value for Whole Foods Market's shareholders, while at the same time extending our mission and bringing the highest quality, experience, convenience and innovation to our customers.”
Amazon hopes to target the generation sitting around the age of 25; these people are starting lives in a technological world, raising families and needing a lot more to sustain themselves. Although only a small percent of shoppers buy their groceries online or have some sort of delivery service. Amazon hopes to create a fresh home delivery service that is easy for customers to use.