Recently, it was announced that massive online retailer Amazon is buying high-end grocer Whole Foods for a whopping $13.7 billion.
As high as that price tag may sound, some Whole Foods investors argue that it could have been higher if other retailers were given the chance to bid, especially considering that just two years ago, Whole Foods was valued at about $18 billion.
According to reports, the deal was announced just weeks after Amazon and Whole Foods CEOs initially met during a meeting that lasted less than three hours. The CEO of Whole Foods, John Mackey, reportedly fell in love with the deal right away and the prospect of being acquired by Amazon.
Shareholders were less enthused and far more dubious. Some maintain that Mackey made the deal for his own peace of mind, and not for the good of the company. Still others are holding out hope that another retailer will make an offer, prompting a bidding war.
There are some important lessons that readers can take away from this story, including the lesson that it is not always in everyone's best interests to act fast when it comes to complex, massive business transactions. Doing so can throw employees, investors and shareholders for a loop that leaves them lost and unhappy.
Readers should also be reminded that business owners have more to think about than what's in their own best interests when it comes to mergers and acquisitions. They must also consider how such a transaction will affect clients, partners and shareholders. Ultimately, though, they will be the ones responsible for the decisions made.
Finally, understand that business transactions are susceptible to changes and challenges, even after a deal has been announced.
If you are a business owner considering a major change in your company, it is crucial to keep these lessons in mind. Failure to plan and protect your business could ultimately cost you much more than you think. Consider the various options in front of you, be thoughtful about your decisions, and talk to an attorney to ensure whatever deals you make are properly made and enforced.