At least the long, surreal nightmare is over. Whole Foods Market
Whole Foods will sell 32 stores (13 of which are currently operating), and it will also have to divest itself of intellectual property related to Wild Oats. Employees of the operating stores will be offered guaranteed jobs at other stores or “enhanced” severance packages. Whole Foods will take a $19 million charge related to the settlement proceedings.
It’s a bummer (I mean, come on, Whole Foods took on a lot of debt for this acquisition), but it’s also a relief. This uncertainty has been hanging over Whole Foods for a long while. The outrageous witch hunt the FTC waged against Whole Foods started in mid-2007 and continued even after the FTC’s case was shot down in court and Whole Foods had completed the acquisition. It has only become more absurd, as Whole Foods has seen steadily increasing competition from rivals like Wal-Mart
Surely the FTC has had much better things to worry about than Whole Foods’ acquisition of Wild Oats (and come on, the acquisition’s gone so “well” that I was recently moved to say thanks for nothing, Wild Oats). According to a Wall Street Journal article, FTC Chairman Jon Leibowitz’s statement on the settlement said that it “allows the FTC to shift resources to other important matters.” Well, no kidding; I don’t think I’m alone in the thought that this proceeding never seemed like a very good use of taxpayer money.
Apparently the resolution will allow us poor, apparently feckless consumers to see “more choices and lower prices for organic foods,” too. I guess the FTC has to stick to its guns on this line of thinking, since it was so stubborn about it. The big problem many of us had with the FTC’s stance from the start was that there are plenty of places to get organic products and that nobody was going to starve to death from theoretical organic-food price gouging. Indeed, Whole Foods has definitely had to address price, as consumers have grown more guarded about their budgets.
I just needed to rant one more time. Sirius XM
The FTC’s antitrust challenge helped insert increased risk into Whole Foods Market stock, so resolution is good news for us long-patient shareholders. At least Whole Foods can finally move on and address the harsh economic headwinds and, yes, the price-cutting competition. It’s about time.
Here’s some related, recent news on Whole Foods: