Amazon Inc (NASDAQ:AMZN) is putting a slug of its US$25bn of cash to work with the acquisition of a bricks and mortar retailer in the form of organic chain Whole Foods Market Inc (NASDAQ:WFM).
It is splashing of US$13.7bn for the group, making this Amazon’s biggest ever transaction, dwarfing the US970mln it paid in 2014 for games developer Twitch Interactive.
"This partnership presents an opportunity to maximize value for Whole Foods Market's shareholders, while at the same time extending our mission and bringing the highest quality, experience, convenience and innovation to our customers," said Whole Foods boss and founder John Mackey.
WATCH: Here's how CNBC is reporting the deal
He has been under pressure from a hedge fund called Jana Partners and Neuberger Berman, an investment manager, which has criticized the grocer’s recent poor performance and called for the sale of the business.
The offer of US$42 a share represents a 18% premium to Thursday’s Whole Foods closing price.
The company opened its first store in 1980, in Austin, Texas, home to its headquarters and has grown to 431 supermarkets employing over 90,000 in the US, Canada and the UK.