Giant online retailer Amazon is acquiring Whole Foods in a $13.7 billion transaction, and some people are wondering how partnering technology with grocery services will affect customers.
"This is an earthquake rattling through the grocery sector as well as the retail world," Bankrate.com senior economic analyst Mark Hamrick said in a prepared statement. "We can only imagine the technological innovation that Amazon will bring to the purchasing experience for the consumer."
Click here for a 2012 article about Greenlife reopening as Whole Foods.
In the merger agreement, Amazon will acquire Whole Foods Market for $42 per share in an all-cash transaction, including Whole Foods Market’s net debt.
Whole Foods Market will continue to operate stores under the Whole Foods Market brand and source from trusted vendors, according to a news release.
Whole Foods Market co-founder and CEO John Mackey, who will keep his position at the company's headquarters in Austin, Texas, said the partnership is a chance to benefit shareholders and customers.
"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," he said in a prepared statement.
Local stores and employees aren't expected to be affected by the change.
The deal is expected to be complete by the second half of 2017.
Amazon founder and CEO Jeff Bezos said he wants to continue what Whole Foods started.
"Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy," he said in a prepared statement. "Whole Foods Market has been satisfying, delighting and nourishing customers for nearly four decades—they’re doing an amazing job and we want that to continue."
Hamrick said this should be a good deal for current Whole Foods customers and that it could draw in new ones.
"Amazon can be expected to work to deliver better value to grocery customers, both online and within the brick-and-mortar space," he said.
Local residents reacted via Twitter to the announcement.
Odd timing with Aldi and Lidl recently announcing their aggressive US plans.— Brian Winsett (@eeebri) June 16, 2017
Think it's an interesting play into the food distribution/shipping market. And diversifying the business a bit. Odd, but might work.— Andy Golden /☁ (@owtdoorguy) June 16, 2017
It's not the first time someone has ever spent a lot of money for Whole Foods— Galen Riley (@thatgalen) June 16, 2017
I think AMZ wants to get heavier into groceries and is using WF as platform. AMZ buy power may let it get better cost.— Grackle & Oak (@GrackleOak) June 16, 2017
Seems to be another piece in becoming a seller monopoly Click & prime ship much easier than any other choice.— Grackle & Oak (@GrackleOak) June 16, 2017
Not true monopoly, but if you can buy everything from perishables to digital movies from your phone, why go anywhere else seems their angle— Grackle & Oak (@GrackleOak) June 16, 2017
Other Twitter users outside Chattanooga had fun with their online reactions.
I love whole foods gouda pasta, does this mean I can get it same day without leaving my house?— Vincent Adultman (@angelaliz_) June 16, 2017
Updated @ 2:14 p.m. on 6/16/17 to add more information as it became available.