In this file:
· Amazon to Acquire Whole Foods in $13.7 Billion Bet on Groceries
· Amazon to buy Whole Foods Market for $13.7B, dramatically expanding physical retail footprint
· Amazon is buying Whole Foods in a deal valued at $13.7 billion
· Instant View: Amazon to Acquire Whole Foods for $13.7 Billion
· What's The Grocery Business Really Worth To Amazon? More Than You Might Think
· Amazon Gets Competitive In Twin Cities Grocery Wars
· Amazon granted a patent that prevents in-store shoppers from online price checking
· Odeon supports Amazon stock split rumors
· Whole Foods CEO John Mackey calls activist investor Jana 'greedy bastards'
· Grocers and retail stocks are getting killed on Amazon-Whole Foods deal
Whole Foods Surges 26% On Amazon Deal, Target & Walmart Shares
Take A Hit
· Amazon wants to become Walmart before Walmart can become Amazon
Amazon to Acquire Whole Foods in $13.7 Billion Bet on Groceries
by Nick Turner, Bloomberg
June 16, 2017
Amazon.com Inc. will acquire Whole Foods Market Inc. in a $13.7 billion deal, marking the biggest transaction ever for the e-commerce giant as it pushes deeper into groceries.
Amazon will pay $42 a share in cash for the organic-food chain, the companies said on Friday. John Mackey, Whole Foods’ outspoken co-founder and chief executive officer, will continue to run the business.
Amazon’s biggest acquisition to date came in 2014, when it agreed to buy video-game service Twitch Interactive Inc. for $970 million in cash, according to data compiled by Bloomberg. The Seattle-based company had about $21.5 billion of cash and equivalents...
Amazon to buy Whole Foods Market for $13.7B, dramatically expanding physical retail footprint
by Todd Bishop, GeekWire
June 16, 2017
Amazon will acquire Whole Foods Market for $13.7 billion, marking the Seattle-based tech giant’s most ambitious expansion yet into brick-and-mortar retail.
It’s the largest deal in Amazon’s history, many times the $1.2 billion that the company paid for online retailer Zappos in 2009. The purchase price represents a premium of about 30 percent over Whole Foods’ market value of $10.5 billion based on the retailer’s last closing share price.
No layoffs are expected to result from the acquisition, according to a source familiar with Amazon’s plans. That could be a relief to Whole Foods employees who might look at the deal with the tech giant and envision their jobs being replaced by robots. That doesn’t appear to be the case, at least not in the foreseeable future.
Amazon has until this point developed its own brick-and-mortar bookstores across the country, and tested grocery concepts with two AmazonFresh Pickup sites and the experimental Amazon Go store in its hometown. Amazon has also rolled out the AmazonFresh grocery delivery service across the country.
“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” said Amazon CEO Jeff Bezos in a news release announcing the acquisition agreement. “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.”
Reading between the lines of Bezos’ statement, Amazon is signaling that it doesn’t plan to disrupt what Whole Foods is doing with a major shakeup of the retailer’s infrastructure or strategy in the near term. Amazon has a history of allowing acquired companies — from Audible to Twitch to Zappos — to continue operating with relative independence, with some product and feature integrations.
Whole Foods has experimented with in-store technology through its “365 by Whole Foods Market” concept, including speedy checkout and digital price tags, but its new coupling with the tech giant would take things to a different level. It would be easy to imagine existing Amazon services such as the Prime membership program and Fresh delivery service integrating with Whole Foods’ infrastructure, but Amazon isn’t tipping its hand for now.
The deal is a shocker to many in the retail business, but maybe it shouldn’t have been:
Amazon is buying Whole Foods in a deal valued at $13.7 billion
Amazon to acquire Whole Foods for $42 a share, in a deal valued at $13.7 billion.
John Mackey will remain CEO of the grocery store chain.
The deal is expected to close in the second half year.
Sarah Whitten, CNBC
June 16, 2017
Amazon said Friday it plans to acquire Whole Foods Market for $42 a share, in a deal valued at $13.7 billion.
Whole Foods CEO John Mackey will remain CEO of the grocery store chain after the deal closes, and the store will continue to operate under the Whole Foods brands.
The deal is expected to close in the second half year.
"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," Mackey said in a statement.
Whole Foods has been under pressure from Jana Partners hedge fund and money management firm Neuberger Berman, which have called on Whole Foods to sell itself...
Instant View: Amazon to Acquire Whole Foods for $13.7 Billion
via NEW YORK TIMES _ JUNE 16, 2017
(Reuters) - Amazon.com Inc is buying Whole Foods Market Inc for about $13.7 billion at a price of $42 a share, the companies said on Friday.
TIM GHRISKEY, CHIEF INVESTMENT OFFICER OF SOLARIS ASSET MANAGEMENT IN NEW YORK, NEW YORK:
“That was rumored, I totally dismissed it. Wow. Amazon can pour money into any investment and they don’t need to make money. Investors are used to them not making money. It is $13.7 billion but it is still small relative to the size of the whole company.
"It seems like a bit of an odd purchase because it is brick-and-mortar retail. On the other hand it gives them a distribution footprint to deliver goods in a short time frame. Perishable goods and food aren’t always the best when delivered by FedEx. Obviously canned goods are.
"It gives them a presence, the stores can be expanded to do other things...
What's The Grocery Business Really Worth To Amazon? More Than You Might Think
About: Amazon.com, Inc. (AMZN)
James Brumley, Seeking Alpha
· Nomura Instinet analyst Anthony DiClemente sees the bigger picture.
· The grocery industry's bottom line is actually a lot compared to Amazon's.
· Amazon.com has already proven it can out-grocery traditional grocery stores.
On Thursday, Nomura Instinet analyst Anthony DiClemente upped his target price on Amazon.com (NASDAQ:AMZN) largely in response to the company's recent venture into the grocery business. DiClemente now thinks AMZN's shares are going to reach $1,100 versus a prior target of $975. That's roughly 15% better than its current price.
While his view was oddly optimistic, he may have a good underlying point - investors may be underestimating just how big of a deal food could be for Amazon.
To that end, just how big might the grocery business be for Amazon, and is there any proof the company can profitably differentiate itself from other players? Answers to those questions are, (1) big, and (2) yes.
Where Nomura's Coming From ...
Amazon Gets Competitive In Twin Cities Grocery Wars
By John Lauritsen, CBS Minnesota
June 15, 2017
MINNEAPOLIS (WCCO) — Shoppers in the Twin Cities have plenty of options when it comes to groceries — there are stores like Cub or Target, and companies that bring your shopping list right to your front door.
Right now, Amazon delivers groceries in some parts of the Twin Cities, but the online giant’s food options and the area it serves are growing.
“I usually do the grocery shopping. I’ll go on the weekends. Take one of the kids, maybe two,” Mike Fuhrman said.
For Fuhrman, that means a trip to Lund’s or Target. It’s a chance to get out of the house and fill up his cart. But he says there are days when he wouldn’t mind having someone else do the shopping.
“I think we would use it if sometimes you are gone all weekend and don’t have the chance to get out and get groceries,” he said. “It’d be nice to have just a few items delivered when you need it.”
And that list of grocery delivery options is growing.
“Yes they are in this market. Yes they deliver,” University of Minnesota marketing professor George John said. “But they keep expanding the things they deliver.”
John said Amazon is still a relatively new player in the Twin Cities grocery wars, delivering eggs, milk and ice cream. But it’s adding more choices every day.
And with stocks down for Target, Supervalu and others, John thinks a new initiative called Amazon Fresh could be a game changer.
“So now Amazon looks at it and says ‘Hey, Amazon Fresh, another $15 and we’ll deliver groceries to you,'” said John.
Retail experts speculate that it may not be long before they are delivering fruits and vegetables as well. John believes existing Twin Cities grocers can live with Amazon, but they may have to adjust.
“My message is: If you are competing with Amazon — and you are, whether you know it or not — you need to figure out how to coexist with them, not copy them,” said John...
Amazon granted a patent that prevents in-store shoppers from online price checking
Well, isn’t that ironic
by Dani Deahl, The Verge
Jun 15, 2017
Amazon’s long been a go-to for people to online price compare while shopping at brick-and-mortars. Now, a new patent granted to the company could prevent people from doing just that inside Amazon’s own stores.
The patent, titled “Physical Store Online Shopping Control,” details a mechanism where a retailer can intercept network requests like URLs and search terms that happen on its in-store Wi-Fi, then act upon them in various ways.
The document details in great length how a retailer like Amazon would use this information to its benefit. If, for example, the retailer sees you’re trying to access a competitor’s website to price check an item, it could compare the requested content to what’s offered in-store and then send price comparison information or a coupon to your browser instead. Or it could suggest a complementary item, or even block content outright.
Amazon’s patent also lets the retailer know your physical whereabouts, saying, “the location may be triangulated utilizing information received from a multitude of wireless access points.” The retailer can then use this information to try and upsell you on items in your immediate area or direct a sales representative to your location...
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Odeon supports Amazon stock split rumors
By: Brandy Betz, SA News Editor, Seeking Alpha
Jun. 15, 2017
· Amazon (NASDAQ:AMZN) stock split rumors swirl after a tweet from The Street’s Douglas Kass. Odeon analyst Jahanara Nissar says she wouldn’t be surprised if Amazon did split.
· Kass’ tweet sourced his “Gnome” and said Amazon wants to “make the co. more eligible to be in the DJIA.”
· Nissar notes that the split would open Amazon for younger investors and that the move is the only way the company can get onto the DJIA.
· Amazon once went through three splits in just over a year...
Whole Foods CEO John Mackey calls activist investor Jana 'greedy bastards'
· "They're putting a bunch of propaganda out there, trying to destroy my reputation..." Mackey said in an interview with TexasMonthly.
· Earlier this year, Jana Partners disclosed a stake in Texas-based Whole Foods and has been pushing for changes at the grocer ever since.
· Last month, Whole Foods decided to overhaul its board of directors.
Lauren Thomas, CNBC
14 Jun 2017
The CEO of Whole Foods is calling out activist investor Jana Partners, tagging them "greedy bastards" who are only interested in making money from a forced sale of the struggling grocer.
"They're putting a bunch of propaganda out there, trying to destroy my reputation and the reputation of Whole Foods, because it's in their self-interest to do so," Mackey said in an interview with TexasMonthly.
Earlier this year, Jana disclosed a stake in Texas-based Whole Foods and has since said it is determined to change the company's board. The firm has been telling Whole Foods to either overhaul its operations or look for potential buyers.
Whole Foods declined to comment to CNBC on the story, and a representative from Jana didn't immediately respond to an email.
Mackey's harsh criticism of Jana comes at a time when his company's same-store sales have fallen for seven consecutive quarters.
Grocery is proving to be a more competitive industry to be in today, with more nontraditional players trying to swoop in and steal market share. Amazon, for example, continues to roll out its AmazonFresh business. And now there's Lidl, a German grocer, opening its first stores in the U.S. Thursday.
"We need to evolve," the Whole Foods CEO told the Texas-based publication. "We need to get better, and we're doing that. But these guys just want to sell us, because they think they can make forty or fifty percent in a short period of time."
In his interview with TexasMonthly, Mackey went on to criticize other "greedy" business leaders in America today.
"There's a narrative about business in America that says, 'Business sucks,' " Mackey said. "It's the idea that business is about a bunch of greedy bastards running around exploiting people, screwing their customers, taking advantage of their employees, dumping their toxic waste in the environment, acting like sociopaths."
Last month, Whole Foods finally did decide to overhaul its board...
Grocers and retail stocks are getting killed on Amazon-Whole Foods deal
Katie Little, CNBC
June 16, 2017
News that e-commerce giant Amazon.com is buying grocery store Whole Foods Market sent grocery stocks reeling Friday.
Amazon said it would buy the natural and organic foods supermarket chain for $42 per share in an all-cash deal valued at about $13.7 billion. The deal is expected to close in the second half of the year.
Following the announcement, Amazon stock rose 3 percent while Whole Foods shares skyrocketed 28 percent.
Shares of large grocery chains dropped following the news.
Kroger sank 14.5 percent. Supervalu plummeted 17 percent while Costco fell 7 percent. Sprouts Farmers skidded 12.7 percent, and United Natural Foods dropped more than 15 percent.
Discount retailers Target and Wal-Mart also fell...
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Whole Foods Surges 26% On Amazon Deal, Target & Walmart Shares Take A Hit
Adam Sarhan, Forbes
Jun 16, 2017
The big news today is Amazon's $13.7 billion purchase of Whole Foods.
Whole Foods has been struggling in recent years as the organic supermarket faced slow growth, and failed to compete against other giants such as Kroger, Target, The Fresh Market, and Wal-Mart, just to name a few.
This morning though, as Amazon and Whole Food shareholders rejoiced, competitors' stock prices tanked. Shares of Kroger, gapped down 13% on Friday morning. That follows yesterday's drop when Kroger's stock fell after reporting earnings. Shares of Target dropped down over 10% and hit a fresh 52-week low on the take-over news.
Shares of Wal-Mart plunged over 6% on the news because the retail giant has struggled to compete with Amazon to attract online shoppers in recent years. The one big advantage Wal-Mart had over Amazon was the huge fleet of stores it has all over the country. Now, that advantage is coming under threat.
Amazon wants to become Walmart before Walmart can become Amazon
by Sarah Perez, TechCrunch
June 16, 2017
The future of retail will be a combination of both online e-commerce and a brick-and-mortar retail presence – as recent moves from both Walmart and Amazon have shown, including today’s back-to-back announcements from the two rivals, which sees Amazon buying a chain of popular grocery stores with a Whole Foods deal for $13.7 billion, and Walmart picking up yet another online apparel vendor with Bonobos for $310 million.
Walmart is the only retailer with the size, scale and funds to take on Amazon, and it’s been making aggressive moves to compete with Amazon’s online business for years. Amazon, on the other hand, has been trying to figure out how to merge brick-and-mortar stores into its world of online shopping.
The question is, which retailer will figure out the perfect mix of online and offline, and get there the quickest?
As of late, Walmart been targeting Amazon’s Prime business – launching free, two-day shipping on millions of items, without requiring an annual membership, for example. The move hasn’t been lost on Amazon, which in turn has gone directly after the Walmart shopper, by making it easier for lower-income consumers to pay with cash on its site. It even discounted Prime for those on government assistance, arguing that a Prime membership is not a luxury, but a need.
The truth is, Amazon needs to capture the Walmart shopper as it has saturated the middle to high-end of the market with Prime memberships; approximately 60% of U.S. households now have Prime, with lower-income households the only place it can still grow Prime stateside.
Beyond its Prime cash cow, Amazon has also made moves to better tackle the grocery business – a tough area to compete as an online-only retailer, given the need to keep fresh items cold, and others frozen. Amazon has slowly ramped up in this area over the years via its delivery service AmazonFresh, but it has not been able to widely scale grocery deliveries due to the logistics and economics (or “enormous money pit,” more colloquially) involved with delivering perishable items.
Here, however, Walmart has an advantage. It has stores within 10 miles of 90% of American shoppers, and has quickly expanded its service that lets online customers place orders online to pick up curbside at their nearest store. It’s even trialing drive-up grocery pickup kiosks, to make the process easier.
Amazon, on the other hand, is still a relative newcomer to brick-and-mortar retail, compared with Walmart. Though it just opened its own drive-up grocery pickup service in Seattle, many of its effort in brick-and-mortar feel more experimental.
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