Amazon said on Thursday that its $13.7 billion acquisition of Whole Foods will close on Monday. As the two organizations work to incorporate their business, all clients will quickly observe “lower prices on a selection of best-selling staples across [Whole Foods] stores….” Amazon said it would first need to coordinate Amazon Prime into the Whole Foods point of sale framework. Once complete, the offers will start, and, in the end, Prime will become Whole Foods’ client rewards program.
Grocery stocks quickly tumbled Thursday evening on receiving the news. Amazon promises prompt value cuts puts weight on customary food merchants that are as of now working in a thin-edge business. Meal-Kit organizations, similar to Blue Apron, have likewise gotten hammered after Amazon declared it would be making a comparable service. On Wednesday, Whole Foods investors voted to fast-track Amazon’s acquisition of the grocery chain, moving the proposition one step closer to reality. Amazon investors didn’t have to approve the arrangement.
The two groups were stated they anticipated that they would settle their merger amid the second half of 2017. However, a source comfortable with the issue revealed to CNBC the arrangement could happen “sooner instead of later.” Just hours after Wednesday’s investors vote, the Federal Trade Commission said it would permit the Amazon-Whole Foods arrangement to continue. The FTC had been leading an examination to gage whether the merger would diminish rivalry under government controls.
A representative from Amazon told CNBC on Thursday that it has no plans for cutbacks or to utilize automation to supplant Whole Foods’ clerks. This was a generally held worry that started banter when the purchase was first announced. And this is especially concerning for those organizations, similar to Sprouts, that work neck-and-neck with Whole Foods in natural foods. Here, costs have had a tendency to be higher than with customary and non-perishable things.
“The bottom line is that this isn’t theory any more,” GlobalData Retail Managing Director Neil Saunders told CNBC. “The deal is happening, and it will drive change in the grocery sector. Competitors will need to think about what that means for them and respond accordingly.” In its press release on Thursday, Amazon didn’t mention exactly how it would use Whole Foods’ portfolio of more than 450 stores.