Whole Foods Market co-founder and co-CEO John Mackey on Monday denied reports that the Austin-based company is looking to go private.
Speculation about a possible buyout began popping up in November, and last week investing news website Benzinga reported that two private equity firms — Cerberus Capital Management, which owns the Albertson’s grocery chain, and Brazilian firm 3G Capital — were looking to take Whole Foods private in a joint offer.
But in a Monday interview with the American-Statesman, Mackey said Whole Foods has no ongoing plans to go private and said the company is instead focused on a new plan to boost sales.
“I don’t know where all these ‘going private’ rumors come from,” Mackey said. “We don’t have any announcements. We are not working on anything. It’s just rumors… It’s rumor and speculation.”
Whole Foods is one of Austin’s highest-profile companies, with 91,000 workers for 434 stores worldwide and about 2,500 employees in Central Texas.
The organic foods giant is in the midst of rethinking its business and revamping its brand, as traditional supermarkets, big-box stores and online retailers have stepped up their organic food offerings and chipped away at Whole Foods’ dominance.
Whole Foods has issued a turnaround plan for 2016 aimed at helping it regain its market dominance. In a November call with investors, the company’s executives laid out a nine-point plan to improve the company’s fortunes.
“I don’t want to say point-blank that Whole Foods would never go private, because that could be used against us if we ever changed our mind,” Mackey said Monday. But at this time, “we feel very much the strategy we outlined in our last call (in November) …that we can execute that strategy.”
That plan entails key areas of the business, such as reducing expenses, differentiating the Whole Foods shopping experience with a new team focused on prepared foods and hospitality and boosting value perception and digital efforts.
For example, the retailer last week made good on one part of that plan to fill a newly created position of global vice president of culinary and hospitality. Whole Foods hired University of Texas graduate Tien Ho, a renowned chef, to fill that post.
Company executives say the new position will bolster and extend the retailer’s food innovation, service and hospitality across all stores.
And while part of the nine-point plan also emphasizes a slowing of aggressive store growth, the retailer will also launch a new chain of value-focused, smaller store formats, 365 by Whole Foods, next year.
Even with the new strategy, the recent rash of “going private” rumors picked up again after Whole Foods’ November earnings report missed Wall Street expectations. The chatter resurfaced again in recent days, which may have helped boost the stock about 15 percent last week.
On Friday alone, the stock rose more than 8 percent to $34.02.
Experts also said last week’s stock gains might also have been fueled by a note from analyst firm ITG suggesting the company is poised to top sales forecasts this quarter.
Whole Foods’ shares closed Monday down 68 cents, or 2 percent, at $33.34.
Whole Foods’ co-founder and co-CEO John Mackey sits down with American-Statesman reporter Claudia Grisales for a wide-ranging interview. In Sunday Business.