Whole Foods Facing Possible Buyout

ROCKY RIVER, OH - Struggling organic grocery chain Whole Foods Market - which has three Northeast Ohio locations - may be the subject of a takeover bid by Albertsons, an Idaho-based grocer backed by a large private equity firm. Whole Foods, which bills itself as the “clean food” grocer, has seen its shares fall some 45 percent since October 2013, according to a Fortune.com report.

Whole Foods has locations in Rocky River, Woodmere, and University Heights, and six more locations throughout Ohio. The Austin, Texas-based company has 365 stores nationwide. Earlier this year, hedge fund Jana Partners bought a 9 percent stake in the upscale grocery chain, Fortune reported.

One of Albertsons' backers, private equity firm Cerberus Capital Management, has recently held preliminary talks with banks about a buyout. Meanwhile, MySanAntonio.com is reporting that Jana and Cerberus may partner in a buyout bid of Whole Foods. After taking its 9 percent stake, Jana told Whole Foods it should consider a sale.

Whole Foods’ sales have fallen in the face of competition from organic grocers such as Sprouts Farmers Market and Natural Grocers and traditional grocers including Walmart and Kroger, which are increasingly moving on Whole Foods’ turf with their own organic offerings, MySanAntonio reported.

The Austin company has suffered six quarters of falling same-store sales, a key measure in retail performance, and announced plans in February to close nine stores, the news outlet reported. Amazon, which also operates the grocery operation Fresh, considered buying Whole Foods last year but never made a bid, MySanAntonio reported.

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Story by Scott Daniel, Patch