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Feds move to block Wild Oats takeover

This article was originally published in The Tan Sheet

Executive Summary

Market proximity of two major natural/organic food industry competitors prompts FTC to move against the proposed $670 mil. acquisition of Wild Oats Markets by Whole Foods Market. The June 6 complaint filed in the U.S. District Court for the District of Columbia seeks a temporary restraining order and preliminary injunctive relief blocking the deal pending an administrative trial. FTC is concerned the merger will result in higher prices and reduced quality and services, the commission says. "While we disagree with the FTC's position and believe it is without legal and factual merit, we are confident that, once presented with the facts, the court will agree that this merger is pro-competitive and the FTC's application for injunction is denied," Wild Oats Chairman and CEO Greg Mays states. The companies announced plans Feb. 21 to merge both entities in an agreement under which Whole Food acquires 110 stores via the buyout of Wild Oats (1"The Tan Sheet" Feb. 26, 2007, In Brief)...

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Whole Foods/Wild Oats

U.S. District Court for the District of Columbia Judge Paul Friedman denies FTC's lawsuit requesting a preliminary injunction against the proposed $670 mil. merger of Whole Foods Market and Wild Oats Markets. The federal agency may appeal the Aug. 16 ruling and may seek a stay from either the District Court or the U.S. Court of Appeals for the D.C. Circuit to preclude the closing of the merger. Absent a stay pending an appeal, the firms may close the transaction any time after noon on Aug. 20. Under terms of the deal, Whole Foods will acquire all outstanding shares of Wild Oats for $18.50 per share in cash. The firms say the merger will benefit stakeholders, customers and shareholders. FTC filed its suit against the two major natural/organic food industry competitors June 7, fearing the merger would violate federal antitrust laws (1"The Tan Sheet" June 11, 2007, In Brief)...

Whole Foods sells

Whole Foods Market plans to transfer all 35 of its Henry's and Sun Harvest store locations and a Riverside, Calif. distribution center to a Los Angeles-based food retailer, on the condition Whole Foods prevails in the current anti-competitive lawsuit with FTC over the firm's merger with Wild Oats and the completion of the merger, the firm announces June 20. The unnamed food retailer is a wholly owned subsidiary of Smart & Final Inc., Whole Foods says. FTC filed a complaint in the U.S. District Court for the District of Columbia in June after Whole Foods announced plans for the Wild Oats acquisition (1"The Tan Sheet" June 11, 2007, In Brief)...

Whole Foods expands

Whole Foods will acquire 110 stores in 24 states through its purchase of Wild Oats Markets, the company announces Feb. 21. The retailer will buy Wild Oats Markets' outstanding common stock in a cash tender offer of $18.50 per share, or approximately $565 mil. based on fully diluted shares, according to a press release announcing the deal. Whole Foods will gain stores in each of its 11 operating regions through the transaction and will enter "a number of new markets"...

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