Whole Foods shares keep rising in bidding war speculation
- Author: Zachary Reyes Jun 24, 2017,
Jun 24, 2017, 8:10
"Over time, there could be other formats that evolve that- that might- wouldn't be branded Whole Foods Market, potentially, wouldn't be our standards", Mackey explained. Mackey said mutual friends set the companies up on a "blind date" in Seattle a little over six weeks ago, and that executives immediately hit it off and ended up speaking for more than two hours.
Ripka had once compared nabbing Whole Foods as an anchor tenant to "going to the ball with one of the belles", and his opinion on this has not changed, despite the new opportunities for online grocery shopping that Amazon's purchase could open up.
"We've seen Amazon expand recently into physical, brick-and-mortar stores, for example their new bookstores and Amazon Go, their small grocery store experiment that doesn't require a customer to go through check out", says Elizabeth Lim, senior analyst for Mergermarket. I think we could've talked for 10 hours.
But Whole Foods has struggled in recent years, and the $33.06 price was about half where Whole Foods stock was trading at its peak in October 2013. We haven't heard anything from Amazon about whether this is true. With the financial backing of Amazon behind it, it could further delve into this market and support local foods in a real way.
Mackey isn't saying the company's almost 90,000 employees are about to take a hit, but he's been very frank that there will be changes.
Giammona says there is some concern among "hard-core Whole Foods fans" that Amazon could change the grocery's image and product options.
"Any smart board recognizes it's probably smarter to try to pay more" for Whole Foods "to keep Bezos out of this game", Schiffer said.
"This store has become a money-making machine", said Tony Castro, a 40-year-old private chef, who shops daily in Whole Foods' sprawling downtown Los Angeles store.
"Amazon competes head to head with Walmart, so that's a very different world than organic food or quinoa and kale and the premium food that Whole Foods is known for", he says. "This is something you need every single day, so it's something that every consumer will feel every day".
Clearly, this is not word that Amazon wants out on the street just yet. "Whole Foods is expensive enough".
Culpepper, who owns Kroger Co shares, said Kroger is the company that would be most likely improve Whole Foods' efficiency, but that it would have difficulty matching Amazon's cash offer. "So dreams are powerful things". An Amazon spokesperson told Bloomberg that there are no plans for job cuts or increased automation at Whole Foods stores, and Mackey certainly didn't mention at the town hall that any jobs might be eliminated.