Amazon to buy Whole Foods for $13.7 billion

  • Amazon to buy Whole Foods for $13.7 billion

Amazon to buy Whole Foods for $13.7 billion

Now, Amazon is looking to become a hybrid retailer and challenge Walmart for supremacy as the nation's largest retailer.

If Amazon does find a way to end the deal - or carve out the non-perishables business for itself - Instacart's revenue will take a hit.

Amazon is buying Whole Foods for $13.7 billion, and that could be bad news for Instacart. The US retail market is valued at USD130 Billion.

Inc. will pay $42 per share for Whole Foods Market Inc., including debt.

"We expect this transaction to further accelerate the consolidation within the supermarket space", said Mickey Chadha, senior credit officer at Moody's Investors Service.

The deal proves Amazon's increasing interest in moving into operating traditional brick-and-mortar stores and its growing focus on groceries.

The deal sent shockwaves across the food distribution market and beyond.

The deal represents a dramatic turn in strategy for Amazon, which has offered food delivery through its AmazonFresh service for a decade, but has not made a major dent in the $700bn grocery market.

"I'm excited to see maybe if they do some kind of thing with Prime now and Whole Foods, that would be interesting to me", Hiddeman said. Amazon is experimenting with a store in its Seattle hometown where customers will buy groceries without even having to go through a checkout line, using an app and computer vision.

The transaction will need to get the seal of approval from Whole Foods Market's shareholders.

The deal comes a month after Whole Foods announced a board shake-up and cost-cutting plan amid falling sales.

Whole Grocer, which was founded in 1978, would continue to operate under its existing brand.

And this headline from Business Insider helps explain it: Amazon is acquiring Whole Foods - and Walmart, Target, and Kroger should be terrified. Whole Foods is known to attract high-income shoppers, who can afford to dole out cash on over-expensive foods and this was the center of all the jokes on Twitter. While the bid for Whole Foods may not bridge Amazon's "last mile", it certainly brings it closer, experts say.

The grocery and supermarket industry in the United States is huge, with $12.2 billion in profit, but growing slowly, at a measured 1 percent pace, according to retail analyst IBIS World. It has expanded from a book seller into a merchant of almost all consumer products, as well as producing videos. It wasn't until 2015 that the number of pure grocery stores actually started to decline, according to government numbers, and then only slightly.

Stock rates of supermarkets, food producers, processing companies, retailers, and shopping malls lost over U.S.$35 billion nearly immediately after the news was released, indicating the potential effect this could have on the various industries.