(FoxBusiness): E-commerce giant Amazon (AMZN) announced Friday it will snap up struggling grocery chain Whole Foods Market (WFM) for $42 per share in an all-cash deal valued about $13.7 billion including debt.
“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,” said Amazon CEO Jeff Bezos in a statement.
Under the deal, Whole Foods will continue to operate stores under its independent brand and the company’s CEO and founder, John Mackey will remain in his position. Mackey said the partnership allows the Austin, Texas-based food retailer to continue efforts to bring high-quality foods and convince to its customers across America.
The deal, subject to approval by regulators and Whole Foods shareholders, is expected to close in the second half of this year.
News of the acquisition sent Amazon shares up nearly 3%, its biggest gain since January as Whole Foods leaped 27% in their biggest rally since 2009 to $42.35.
At the same time, data from Dow Jones showed investors wiped out roughly $55 billion form the market value of other grocery names including Walmart (WMT), Target (TGT), Costco (COST) and Kroger (KR), which cut its full-year earnings guidance on Thursday, extended losses, falling 13% Friday.