The Federal Trade Commission (FTC) said Tuesday it will file a lawsuit to block Whole Foods Market, Inc.'s proposed acquisition of its smaller rival Wild Oats Markets, Inc.
"We are very disappointed by this decision and we intend to vigorously challenge the FTC in court," said John Mackey, Whole Foods' chairman and chief executive officer. Both Whole Foods and Wild Oats said they will fight the legal challenge.
Austin, Texas-based Whole Foods agreed to acquire Wild Oats in February for $18.50 a share, or roughly $565 million. The deal was expected to close in April, but the transaction was delayed by FTC requests for more information.
The FTC will ask the U.S. District Court of the District of Columbia to enter a temporary restraining order that would prohibit Whole Foods from completing its acquisition of Wild Oats pending a ruling on its request for a preliminary injunction.