Good morning again.
Moments after we hit send on Friday’s Data Sheet, Amazon.com announced its $13.7 billion acquisition of Whole Foods. This is a stunning, fascinating, and exciting development, especially for someone who cut his teeth reporting in Silicon Valley by covering the quick rise and ignominious fall of online grocer Webvan during the dot-com bubble of 1999-2000.
Amazon says it will operate Whole Foods independently, much the way it has treated quirky shoe merchant Zappos in the eight years it has owned it. Quirky, by the way, describes Whole Foods and its CEO, John Mackey, to a tee. I was in the audience in San Diego in May at Fortune’s Brainstorm Health conference when Beth Kowitt interviewed him. He’s as forceful and opinionated as Jeff Bezos, his new boss as he’ll stay on.
Amazon has coveted the grocery business for years, with limited success. It also has coveted anything Walmart has. The plunging stocks of grocers this morning shows that Amazon strikes fear wherever it goes just as Walmart, whose stock also is down, once did. Amazon gets more than one of the finest, if struggling, U.S. grocers, of course. It gets a retailer with a physical footprint in 460 stores in North America and the United Kingdom. This will help with sales of Amazon gizmos, books and whatever else it tries to sell.
One last thought … Jeff Bezos is becoming a lot like the Warren Buffett of the information age. That this deal is friendly-Whole Foods was under attack by activist investors-shows that Mackey saw value in being owned by Amazon, just as family-owned industrial concerns for years gladly sold to Buffett. Bezos has shown creativity and staying power as owner of The Washington Post. Now he’s a grocer too. What’s next?
Oh, and what a great conversation point for Amazon’s top retail executive, Jeff Wilke, when I interview him at Brainstorm Tech in Aspen next month!
Again, have a great weekend.
For additional coverage of Amazon’s largest-ever acquisition, Fortune.com covers the details. You can also read Adam’s in-depth profile of Jeff Bezos from last year. Or maybe start by looking at Fortune’s first big article about Bezos, back in 1996. “By the year 2000, there will be two or three big online bookstores. We need to be sure we’re one,” Bezos told writer Michael Martin. I think it worked out okay.
Walmart’s stock price is getting hit on the news, it’s down 6%. The retailing giant did announce a modest $310 million acquisition of online men’s fashion seller Bonobos.