The Federal Trade Commission has temporarily suspended its antitrust challenge to Whole Foods Market's (NASDAQ: WFMI) 2007 acquisition of Wild Oats to allow the company to explore settlement possibilities.David Wales, the chief competition enforcer at the FTC, told (subscription required) The Wall Street Journal that "We're going to roll up our sleeves and take a look at what they're offering. We're hopeful that a settlement can be reached."
It's amazing that the FTC has stubbornly dragged out this investigation for so long. Since the acquisition of Wild Oats, Whole Foods shares have declined by about 75% -- in part because the company has been hurt by increased competition from traditional grocery stores. Given the performance since the merger, it seems likely that Whole Foods overpaid badly for Wild Oats, and that the deal has certainly not lined the company's pockets.
Whole Foods has offered a settlement proposal to the FTC, so hopefully this mess will be out of the way soon. Whatever Whole Foods offers, it seems likely to be a pittance compared to the legal and administrative fees wasted by the company and the United States government in pursuing this case.
Whole Foods has offered a settlement proposal to the FTC, so hopefully this mess will be out of the way soon. Whatever Whole Foods offers, it seems likely to be a pittance compared to the legal and administrative fees wasted by the company and the United States government in pursuing this case.
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