ad-fullscreen

Amazon.com’s purchase of Whole Foods Market a go

The Federal Trade Commission gave the green light Wednesday to Amazon.com’s purchase of Whole Foods Market in a deal valued at $13.7 billion.

The regulator announced that it will not undertake any further investigation of the acquisition, which is expected to be finalized by the end of this year.

Earlier in the day, Whole Foods shareholders voted to approve the deal. Amazon shareholders do not need to approve the deal. (Jeff Bezos, the founder and chief executive of Amazon.com, owns The Washington Post.)

The deal comes when some have observed that antitrust law is antiquated and ill-prepared to address the dynamics of a modern and fast-changing corporate landscape, which is giving rise to giants like Google, Facebook and Amazon.

This is one of the first big actions by the FTC since President Donald Trump was elected. Trump has regularly criticized Amazon over the president’s impressions about whether the e-retail giant pays taxes.

“Amazon is doing great damage to tax paying retailers,” he wrote on Twitter this month. “Towns, cities and states throughout the U.S. are being hurt — many jobs being lost!”

Amazon, in its latest annual report to the Securities and Exchange Commission, reported that it paid $412 million in income taxes last year, $273 million in 2015 and $177 million in 2014. Amazon collects sales taxes in every state that has one.

The deal – and potential acquisition of more than 460 physical locations – signals a turning point for Amazon, which for years has struggled to break into the $800 billion U.S. grocery business. The company’s decade-old AmazonFresh delivery service has been slow to take off, accounting for 0.8 percent of all grocery purchases last year. Walmart, by comparison, sold 17.3 percent of the country’s groceries, while Kroger sold 8.9 percent, according to Bloomberg data.

Amazon has remained tight-lipped about its plans for the Austin-based food chain. Whole Foods continues to be led by John Mackey, who co-founded the company in 1980 and has grown it into an international chain with nearly $16 billion in annual revenue. The company is also known for having a friendly workplace culture that compensates cashiers and other staffers better than the minimum wage and benefits.

News of the takeover, which was announced in June, has jolted the grocery industry, which is already struggling to keep up with growing competition. Nearly 20 grocers have filed for bankruptcy in the past three years, as regional chains such as Wegmans and Trader Joe’s expand into new markets and delivery services such as FreshDirect gain popularity.

section-ads_high_impact_4
TOP NEWS
News Headlines
pos-2 — ads_infeed_1
post-4 — ads_infeed_2
Local Spotlight
Events
Home Front Page Footer Listing
Circular
You May Like

You May Like