Whole Oats? Whole Foods to Buy Wild Oats 47507

AUSTIN, TexasWhole Foods Market Inc. (NASDAQ:WFMI) signed a definitive agreement to purchase all outstanding shares of Wild Oats Market Inc. (NASDAQ:OATS) for $18.50 per share, a deal worth about $565 million, based on fully diluted shares. In addition to this 23-percent premium (over OATS shares one-month average closing price), Whole Foods will also assume about $106 million in existing Wild Oats debt. Included in the OATS shares will be the 18-percent stake held by Ron Burkle's Yucaipa Cos, which agreed to the sale. The transaction will be funded by senior term loans to the tune of $700 million, the expected net enterprise value of the transaction.

All 11 of Whole Foods operating region will gain stores, and the company also will gain new markets. Three smaller Whole Foods regionsNorthwest, Rocky Mountain and Floridawill gain critical mass, according to John Mackey, founder, chairman and chief executive officer (CEO) of Whole Foods. In addition to Wild Oats $1.2 billion annual sales, Whole Foods expects the merged company will realize several operating synergies, including reduced general and administrative costs, improved purchasing power, better use of support facilities and new team member talent.

The deal is expected to close in April.