Whole Foods Market’s acquisition of rival retailer Wild Oats Markets has been delayed further after a US appeals court said it needed more time to decide whether to block the deal.
The US Court of Appeals for the District of Columbia has put the US$565m takeover on hold after agreeing to give the country’s competition watchdog until tomorrow (22 August) to state the reasons for its appeal.
The Federal Trade Commission has asked the appeals court to stay a ruling laid down last week that had dismissed the watchdog’s request to block the transaction and allowed the deal to proceed.
However, in granting the FTC more time, the appeals court insisted that its decision “should not be construed in any way as a ruling on the merits” of the case.
Whole Foods, which has until tomorrow to respond to the FTC’s request for a stay, is blocked “from taking any further steps to acquire the stocks, assets or any other interest” in Wild Oats until the appeals court has considered the FTC’s fresh arguments and issued its ruling.
Last week, Whole Foods appeared to have succeeded in its six-month battle for Wild Oats after the FTC failed in its attempt to get the takeover blocked.
Whole Foods struck a deal to buy its rival natural and organic retailer in February. The FTC launched its attempt to block the deal in June, arguing that the takeover would stifle competition and lead to higher prices for consumers.
Whole Foods has argued that the merged company would not erode competition, pointing to the increasing expansion of mainstream retailers like Wal-Mart and Kroger Co. into the natural and organic sectors.