Amazon (AMZN) To Buy Large Stake In SpartanNash (SPTN) – Pulse 2.0

Amazon (AMZN) To Buy Large Stake In SpartanNash (SPTN) – Pulse 2.0

  • SpartanNash (NASDAQ:SPTN) recently announced that it has given Amazon (NASDAQ:AMZN) the right to buy up to 5.44 million of its total outstanding stock — which has a value of about 15% of the grocery company

SpartanNash (NASDAQ:SPTN) recently announced that it has given Amazon (NASDAQ:AMZN) the right to buy up to 5.44 million of its total outstanding stock — which has a value of about 15% of the grocery company. The details were revealed in a Form 8-K via Seeking Alpha.

This deal is part of a broader commercial agreement between the two companies. Amazon has been planning to expand on its Fresh grocery store chain. Amazon’s Fresh grocery stores offers organic and low-priced groceries with cashier-free checkout and curbside pickup processes.

SpartanNash is known for distributing groceries to supermarkets, military facilities, and its own stores. The close-knit relationship between Amazon and SpartanNash dates back to 2016.

Currently, the largest SpartanNash customer is Dollar General. Dollar General represents about 17% of the $8.5 billion in SpartanNash’s annual sales, according to Fool. Amazon currently represents less than 10%.

“The potential deepening/expansion of its relationship with (Amazon) is a positive for (SpartanNash), especially if in PrimeNow and Fresh,” wrote Kelly Bania of BMO Capital in a note to clients via MarketWatch. “We estimate that like most contracts with (Amazon), margins may be lower than for independent customers. We believe that this is also a positive in adding additional diversification from (Dollar General)…although it may
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