Whole Foods Acquires Harry's Superstores

AUSTIN, Texas--Whole Foods Market Inc. (NASDAQ: WFMI) signed an agreement with Atlanta-based Harry's Farmers Market Inc. (OTC BB: HARY) to purchase three megastores and support facilities for approximately $35 million in cash. The transaction is expected to close in November. Included in the sale are all assets related to the Alpharetta, Cobb and Gwinnett, Ga.-based Harry's Farmers Market megastores, including but not limited to the real estate, the Harry's Farmers Market name, distribution center, commissary kitchen, bakery and office facilities.

"The most important and successful acquisitions that we have made, such as Bread & Circus, Mrs. Gooch's and Fresh Fields, have provided us with intellectual capital, as well as given us a platform for expansion in key geographic areas," said John Mackey, chairman and chief executive officer of Whole Foods Market (www.wholefoodsmarket.com). "We believe the Harry's acquisition is potentially as significant, due to their knowledge and expertise in operating perishable superstores that we will be able to leverage across the company, in addition to the regional support infrastructure that we will acquire in Atlanta."

Harry's Farmers Market Inc. retained the use of the "Harry's in a Hurry" name through a license from Whole Foods and has kept six of these food stores with the intent of expansion throughout the United States. The company intends to make a distribution to its shareholders in the future, with an amount to be determined by the Harry's board of directors. A portion of the proceeds will be escrowed for potential liabilities connected with the transaction. The remaining funds will be used for ongoing operations of the Hurry stores and potential opportunities related to those stores. "We are pleased that we have been able to negotiate a transaction with Whole Foods Market that is beneficial to the shareholders of our company," said Harry Blazer, chairman and chief executive officer of Harry's Farmers Market (www.hfm.com). "I believe that our megastore customers and employees will be well served by their stewardship and growth of the Harry's Farmers Market brand." Blazer will stay on as a consultant.