Judge allows merger of organic food chains

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The Independent Online

To the relief of middle-class moms all over America, a US judge has removed the final obstacle preventing a merger between two organic supermarket chains, Whole Foods and Wild Oats.

The Federal Trade Commission had tried to block Whole Foods' $565m (£281m) acquisition, saying that it was anti-competitive, but after a judge found it wouldn't limit competition and drive up prices as the agency claimed, the appeals court yesterday cleared the way for the deal to proceed.

Whole Foods calls itself a supermarket, and argued it competes more with the likes of Giant and Safeway, which have been moving in on the lucrative natural foods market with their own lines of organic products. Wild Oats, by contrast, is a failing chain of natural food stores which were in danger of going out of business.

Meanwhile Whole Foods is seeking a new chief executive officer. The visionary businessman John Mackey, who co-founded the company in Austin, Texas, in 1980, is stepping down.

In the course of the court case, it emerged that Mr Mackey had been knocking Whole Foods rivals, including Wild Oats, under a pseudonym on internet message boards. He said of Wild Oats' management: "They are floundering around hoping to find a viable strategy that may stop their erosion." Mr Mackey has since apologised for his "error of judgement".