A question of healthy competition
The FTC today kicks off a two-day hearing on whether Whole Foods' pending buyout of rival organic retailer Wild Oats constitutes a monopoly. And industry watchers are divided on this one, Stacey Vanek-Smith reports.
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Doug Krizner: Organic food retailer Whole Foods has a plan to buy its rival Wild Oats, but the Federal Trade Commission is concerned this deal creates a monopoly. The commission begins a two-day hearing today, and a big piece of the evidence will be the words of Whole Foods CEO John Mackey. Stacey Vanek-Smith explains.
Stacey Vanek-Smith: The FTC says if Whole Foods' half-billion dollar buyout of Wild Oats goes through, it would dominate the market for high-end organic foods.
But industry consultant Al Hamman says consumers have a lot of organic options.
Al Hamman: It's hard to find a grocery store chain that doesn't have some level of organics for sale. Almost three-quarters of traditional grocery stores are in that market now.
But Corporate Attorney Lance Kimmel says the FTC has a good case. The feds are even using comments John Mackey made to Whole Foods' board to justify the buyout of Wild Oats.
Lance Kimmel: He very clearly said, they're eliminating the possibility of Kroger's, SuperValue or Safeway using their brand equity to launch a competing national natural food chain.
On his blog, Mackey says the union would help to increase the competition among traditional supermarkets.
I'm Stacey Vanek-Smith for Marketplace.
