Wild Foods: Mixing Trust with Antitrust Leads to Total Annihilation
Full disclosure, not only do I shop at both stores, I also own stock in both companies. I have not offered my Wild Oats shares for sale to Whole Foods, but if the merger does go through I will have no choice. Also, the merger is likely to have a big local impact in Boulder -- in addition to the Whole Foods (already slated for expansion), there are three Wild Oats stores, plus the brand new Wild Oats corporate headquarters. Undoubtedly, at least one of those locations will close after the merger, reducing our shopping options.
Here's what I don't understand about this merger. Wild Oats shareholders have already tendered (as of a few days ago) about 58% of the outstanding shares of the company to Whole Foods. That's enough to make the merger happen, absent legal issues. Whole Foods is now under an injunction against acquiring any more shares, and injunction is in effect until July 31. They have recently extended the deadline to tender shares until July 20 -- but the company will be under injunction against proceeding with the merger past that date. Whatever will they do?
Unfortunately, although there may be some downsides to the planned merger, it is probably far enough along that it would have a huge negative impact on Wild Oats if the deal is killed. If Mackey can't convince the FTC that his anti-competitive comments were just meaningless bluster, it will probably be left to someone else to come in and pick up the pieces.
Anyone want to buy a health food chain cheap?