Slashdot Mirror
Amazon Threatened To Kill Its Whole Foods Deal if the Grocer Started a Bidding War (recode.net)
An anonymous reader shares a report: Amazon has long had a reputation as a hard-ball negotiator. It turns out its negotiations with Whole Foods leading up to its $13.7 billion acquisition agreement were no different, according to an SEC filing outlining a timeline of the talks between the two companies. On May 23, Amazon made a written offer to acquire Whole Foods for $41 a share, less than a month after the first meeting between senior executives of the companies, the filing said. Whole Foods came back with a counterproposal of $45 a share, which got Amazon to increase its offer to $42. But Amazon's bankers from Goldman Sachs then "stressed several times" that the increase to $42 represented Amazon's "best and final offer." Amazon's bankers "also made it clear again ... that Amazon.com would disengage from its efforts to acquire the company and pursue other alternatives and initiatives if the $42.00 per share price were not accepted," the filing said, "and that Amazon.com expected that the company would not approach other potential bidders while the company was negotiating with Amazon.com." Amazon also threatened it would walk away if the talks leaked to the press, which they did not. Translation: $42 or nada.
The fact that this is somehow a story that made it to Slashdot goes to show how clueless its readers must be to the workings of the real world. This is nothing unusual. In fact its pretty common practice. Entering into talks is a contract of sorts where both agree to the terms. And those terms seldom weigh in favor of the person who needs to be bought, and make no mistake, Whole Foods was in desperate need of being bought.
Not sure that this is true. Whole Foods was/is ostensibly in a different market than most grocery chains are.
Whole Foods is all about the brand. While this is a recipe for profit, its also fragile as hell. Deep pockets like Amazon could destroy the business by targeting the brand.
So I think Whole Foods simply chose the win-win option instead of the option where they definitely get hurt.
"His name was James Damore."
Or CNN...
Just because some shares trade for $35 doesn't mean all shares do.
Once all the shares offered at $35 are bought up the price goes up. Once all the shares at $36 etc. At some point counter parties might notice and begin front running orders. Some parties holding shares may decide not to sell. A board approved $42 price means everyone's shares get converted to a pile of cash.
News for Nerds?
**Life is too short to be serious**
Amazon and Whole Foods engaged in a normal negotiation process..
Entirely self inflicted, and good riddance.
The stock was trading on the open market around $35/share and Amazon spent 20% over retail ($42/share). Seems like Whole Foods "won" the negotiations to me.
That's about normal for this type of buyout. Imagine how the shares would have spiked had word gotten out about an Amazon buyout. Hence Amazon's silence dictum.
Bully: Is that a $35 set of headphones you're wearing?
Victim: Yes... [quiver]
Bully: I'll give you $42 for them, or you can just walk away without telling anyone! [Grrr!]
Victim: Erm, okay.
Same with FOX the last 8 years.
Problem is that "news" is no longer interested in facts.
The lack of response to this gem of a post is revealing. The confected outrage in TFA is ridiculous.
It's been willing to challenge the big bully on the block.
You mean: they've been willing to show everyone that they're basically a mouthpiece for the Democrats. If you want to hear biased things you already agree with, that's a good channel for you. Enjoy. But it's not news.
lucm, indeed.