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Merger activity remained steady last week with four new deals announced and five deals closing. You can find all the active deals listed below in our Merger Arbitrage Tool (MAT) that automatically updates itself during market hours.
There were two new deals announced in the Deals in the Works section.
Amazon’s (AMZN) acquisition of Whole Foods (WFM) for $42/share in cash was a big surprise on Friday and Whole Foods’ stock ended the day at $42.68 after hitting an intra-day high of $43.45. The reason for the enthusiasm was a $48 price target from Barclays and a $45 price target by Oppenheimer, on expectations that another bidder might emerge. When we added Whole Foods to our Deals in the Works section in April, it was on account of rumors of interest by Albertsons. It is also possible that activist investor Jana Partners, with its 8.8% stake in Whole Foods, may hold out for a higher price.
Whether there is any substance to these rumors and whether a higher bid materializes remains to be seen but this deal does appear to be a game changer for both Amazon and in some ways traditional retailers. In the words of Wall Street Journal’s Financial Editor Dennis K. Berman,
“Amazon did not just buy Whole Foods grocery stores. It bought 431 upper-income, prime-location distribution nodes for everything it does.”