https://stratechery.com/2017/amazons-new-customer/
The purchase was of a customer.
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http://www.precursorblog.com/?q=content/why-amazon-buying-wh…
It goes with my months-old dystopian thesis about Amazon. Add to that my thought that if the FTC is having so much trouble accepting the Walgreens-Rite Aid merger, they will likely ask some extremely serious questions about the Amazon-Whole Foods merger.
Another possibility is a bidding war for Whole Foods. Costco, Walmart, Target, and Kroger are likely suspects. Maybe even Hy-Vee or Trader Joe, or another supermarket/food boutique. I suppose not Supervalu (in too much trouble) or Walgreens or CVS (too far from the core business, though they do have fairly sizeable grocery sections).
I think this might be a good buying opportunity for stocks like Costco and maybe Kroger.
“It goes with my months-old dystopian thesis about Amazon. Add to that my thought that if the FTC is having so much trouble accepting the Walgreens-Rite Aid merger, they will likely ask some extremely serious questions about the Amazon-Whole Foods merger”.
Not sure I agree with that: Walgreens and Rite-Aid are both pharmacy companies; Amazon and Whole Foods are not both grocery stores. I suppose the FTC could ask some serious questions about the Amazon-Whole Foods merger, but I’d be surprised if they nixed the deal. JMHO.
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they will likely ask some extremely serious questions about the Amazon-Whole Foods merger
First serious question, how much of the overall grocery market would Amazon and WFM currently make up as a combined entity.
Answer: Less than 10%.
I think the questioning would stop right there.
How on earth could the merger be blocked when they make up such a small part of the pie.
The Feds can’t just say, “Well, we are concerned with how competitive you MAY end up being in the marketplace.”
No, they would have no right to block this merger.
AJ
Watch it get blocked now and I’ll be eating the words above.
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AJ, I think you made very good points - it’s not that similar to the drugstore merger, but we still really don’t know how it will play out.
It will be interesting to see how it does play out. We’ve been living through so many blockbuster pieces of history (not just business history), and I think this is one more.
Actually, azspeedy made one good point, and AJ made the other…