Whole Foods to Buy Wild Oats in $700 Million Merger

AUSTIN, Texas -- In a merger of the only two “supernatural” food chains specializing in organic and natural products, Whole Foods Market here yesterday said it has agreed to acquire its smaller rival, Boulder, Colo.-based Wild Oats Markets, in deal that has an enterprise value of about $700 million, including debt. Whole Foods will pay $18.50 per share in cash for Wild Oats, which has often been reported as a possible takeover candidate. It will also assume the chain‘s debt of $106 million. Wild Oats, which operates 110 stores nationwide, had sales of about $1.2 billion in 2006. The purchase would increase Whole Foods‘ presence in all 11 of its regions, the company said. It said it expected to close some stores and relocate others, and eventually rebrand the acquired stores as Whole Foods. Yucaipa Cos., which is Wild Oats‘ largest investor with an 18% stake, has agreed to tender its shares in the deal, Whole Foods said. “We have always benefited through learning from past acquisitions and believe this merger will result in a company that is much stronger and better-positioned for the future,” said John Mackey, chairman and chief executive officer, Whole Foods.