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E-commerce giant Amazon is all set to buy supermarket chain Whole Foods Market for $13.7 billion

siliconreview E-commerce giant Amazon is all set to buy supermarket chain Whole Foods Market for $13.7 billion

Popular e-commerce giant Amazon.com Inc recently made an announcement regarding the acquisition of U.S. organic supermarket chain Whole Foods Market Inc for $13.7 billion, including debt, marking the internet retailer's major deal and chief incursion into the brick-and-mortar retail sector.

The proposed deal puts a 27 percent premium on Whole Foods' closing share price would could provide the grocer a key competitive edge by allowing it to tap into Amazon's gigantic power to buy and sell goods at a lower cost.

Whole Foods which lately had come under force from the protester evade fund Jana Partners LLC, prompting it to repair its board. "I think that this takes all of the pressure off Whole Foods and gives Whole Foods the opportunity to revitalize that business and of course it stems the criticism from all of these activist investors," said Neil Saunders, managing director of GlobalData Retail in New York.

The deal which happens to be at $42 per share, further the shares were trading just under that level in early trading, while Amazon's shares were up 0.9 percent at $997.41. Excluding debt, the transaction is valued at $13.39 billion, based on 318.9 million diluted shares outstanding as of April 9. The grocer will go on to function stores under the Whole Foods Market brand, the companies said.

However, John Mackey will persist on as chief executive of Whole Foods, and the company's headquarters will remain in Austin, Texas. Amazon and Whole Foods is be expecting to close the deal during the second half of 2017.

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