Austin, Texas Whole Foods Market announced on Wednesday that private-equity firm Leonard Green & Partners is buying a 17% stake in the company for $425 million.
Under the terms of the deal, Leonard Green, through its affiliate Green Equity Investors V, will acquire preferred stock that pays an 8% dividend and is convertible into common stock.
“We view it as a strong vote of confidence in our business model and our long-term growth prospects, despite the current economic environment," said John Mackey, chairman, CEO, and co-founder of Whole Foods Market. "This investment, combined with our strong cash flow from operations, gives us the financial flexibility to manage through these difficult economic times while continuing to prudently invest in our long-term growth."
The transaction is expected to close within 30 days.