Blue Apron Shares Sink After Amazon Files Meal Kit Trademark

Blue Apron's Stock Is Getting Crushed Amid Reports Of Amazon Meal Kit Trademark

The Motley Fool owns shares of and recommends Amazon and Whole Foods Market.

Amazon is cooking up a plan to disrupt the meal-kit delivery business that Blue Apron helped pioneer.

Shares of Blue Apron (APRN) tanked to a record low Monday as reports surfaced that Amazon (AMZN) filed a trademark application suggesting it will enter the meal-preparation kit market.

Now, Amazon is causing some serious indigestion for Blue Apron, which was already grappling with fears of competition in the burgeoning business of shipping boxes of fresh, premeasured ingredients with recipes.

Blue Apron went public shortly after the Whole Foods acquisition was announced, pricing at the bottom of an already slashed valuation.

More news: Here are some of the new emoji coming to iOS 11

Amazon weighed on last month's Blue Apron IPO.

The application tagline is "We do the prep". "The trademark application mentions "... customer loyalty rewards program for shoppers, namely, providing incentive award programs for customers through the issuance and processing of loyalty points and loyalty coupons for frequent use of participating company's goods and services..." and services related to the loyalty program.

IPO in late June couldn't have come at a worse time. Amazon's interest in meal kits directly undermines that pitch.

Concerns about competition forced Blue Apron to take the rare step of slashing its initial public offering price before going public on June 29. Both meal kits are sold through AmazonFresh. If the company becomes strapped for cash, it may increase its borrowing capacity under a revolving credit facility or raise additional funds through equity or debt financing arrangements, the filing said. Some firms declined to lend the company money because it was seen as too risky, while others weren't willing to extend as much as was requested, said the people, who asked not to be identified discussing a private matter.

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