Amazon is buying Whole Foods Market

Amazon is buying American supermarket chain Whole Foods for $13.7 billion, the online retail giant announced today. The acquisition is technically happening as part of a merger agreement that will see Amazon pick up the supermarket’s net debt and purchase its stock at $42 per share. The brick-and-mortar stores will continue to operate under the Whole Foods brand once the deal is complete, which is expected to happen later this year, but is subject to approval by regulators and the supermarket’s shareholders.

“Millions of people love Whole Foods Market because they offer the best natural and organic foods, and they make it fun to eat healthy,” Jeff Bezos, the founder of Amazon, said in a 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.”

Whole Foods will keep its headquarters in Austin, Texas, and the company’s CEO, John Mackey, will remain in his post. The company recently overhauled its board of directors in an effort to survive what The New York Times called the “greatest crisis of confidence in its 37-year history.”

“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.

Amazon has opened its own brick-and-mortar locations in recent years, including bookstores and a small, experimental market with no cashiers or checkout lines. And while it has been delivering groceries for years under the label of Amazon Fresh, the company hasn’t been shy about wanting to expand those efforts by way of establishing a physical presence across the country. In December, for example, The Wall Street Journal reported that Amazon was exploring ways to open up to 2,000 grocery store locations under its own brand.

Bezos built the Amazon empire through online shopping and building and stocking warehouses around the world in order to better fulfill those orders through the mail. But Amazon has also recently gone after the rest of the supply chain involved with that process, too. The company owns thousands of tractor trailers, leases aircraft from Boeing, has experimented with drone delivery, and has been working on developing its own shipping and logistics technologies.