Amazon’s grocery ambitions led it to consider a purchase of struggling health food grocer Whole Foods last year, before ultimately passing without making a bid, according to a report from Bloomberg.
This week activist hedge fund Jana Partners disclosed it is the second biggest shareholder in Whole Foods with a nearly 9 percent stake. The fund is reportedly trying to get Whole Foods to shake up its business or explore a sale.
If Amazon were ever to make such a deal, it would turn the online retail giant into one of the nation’s leading grocery companies. Plus, it would help Amazon deal with Instacart, a grocery delivery service that competes with AmazonFresh.
Amazon has been steadily expanding its grocery business over the last several years. It has built a pair of drive up grocery stores in its hometown of Seattle, as well as the first Amazon Go convenience store. All of those locations are open for beta testing for Amazon employees.
As Bloomberg notes, Whole Foods has a market value of more than $10 billion, and an acquisition by Amazon would buck its purchase history, as some of its biggest buys — Twitch and Zappos — topped out at around $1 billion.