Amazon is an American E-commerce and cloud computing company based in Seattle, Washington. It is a largest Internet based retailer in the world by total net sales [around $ 136 billion (Dec 16) and by market capitalisation which is currently stood at around $ 465 Billion. Amazon also manufacture and sell electronic devices (Kindle e-readers, Fire tablets, Fire TV, and Echo) and world largest provider of cloud infrastructure services.

Whole Foods Market, is the leading natural and organic foods supermarket based in US, having a current market capitalization of around $ 13.46 Billion. In fiscal year 2016, the Company had sales of approximately $16 billion and has more than 460 stores in the United States, Canada, and the United Kingdom and averaging over eight million customers visits each week. It is the sixth largest grocery store.

Transaction

On June 16, 2017 Amazon and Whole Foods Market, Inc. announced that they have entered into a definitive merger agreement under which Amazon will acquire Whole Foods Market for $42 per share in an all-cash transaction valued at approximately $13.7 billion, including Whole Foods Market’s net debt.

Whole Foods Market will continue to operate stores under the Whole Foods Market brand and source from trusted vendors and partners around the world. John Mackey will remain as CEO of Whole Foods Market and Whole Foods Market’s headquarters will stay in Austin, Texas.

Completion of the transaction is subject to approval by Whole Foods Market’s shareholders, regulatory approvals and other customary closing conditions. The parties expect to close the transaction during the second half of 2017.

Amazon’s offer of $42/share represent almost 27% premium over last closing share price whole food market.

Since scheme is yet to filed with the regulatory authority we have assumed that majority shares of promoter and Institutional investors (holds 92% stake) are bought by amazon.

Financials at a glance

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