Several times during 2007, it seemed inevitable that John Mackey, chairman and chief executive officer of Whole Foods Market, would lose control of the company that he founded as a single natural food store in Austin, Texas, and, over the course of the next three decades, built into a coast-tocoast, multibillion-dollar food retailing trendsetter.

The Federal Trade Commission last year sued to block Whole Foods’ proposed merger with Wild Oats, basing its opposition partly on internal emails that Mackey had sent to fellow board members. Then the Securities and Exchange Commission launched a probe to investigate eight years’ worth of anonymous posts Mackey had made on a Yahoo! message board, cheerleading Whole Foods’ stock and often disparaging the company’s competitors, including Wild Oats.

If the largest acquisition in Whole Foods’ history had collapsed, those indiscretions almost certainly would have led to Mackey’s ouster. But the deal went through, and Mackey — unbowed but perhaps more reserved — retains the top spot at one of the most exciting companies in food retailing.

“We believe our merger with Wild Oats will create longterm value for our customers, vendors and shareholders, as well as exciting opportunities for our Team Members,” Mackey wrote in his most recent chairman’s letter to stakeholders. “Over time, we expect to recognize significant synergies through G&A cost reductions, greater purchasing power and increased utilization of our facilities.”

Whole Foods netted $6.6 billion in annual sales in 2007. Post-merger, the company has 276 locations averaging $617,000 in sales per week. Comparable-store sales were up 7.1% in 2007 vs. 2006; identical- store sales were up 5.8%. These figures continue to tell the story of a very healthy supermarket chain, and many industry observers say Whole Foods is already clearly working its magic on Wild Oats.

“Pre-acquisition, Whole Foods possessed the top real estate potential ranking in the industry,” said Jay Jacobowitz, president of Retail Insights, a natural food retail consultancy based in Brattleboro, Vt.

“Post-acquisition, it still occupies that position, according to our measurements.

“Second point: The most meaningful number that industry watchers and participants can focus on, in our view, is the change in annual sales productivity per square foot of the Wild Oats stores, which has risen approximately 25% post-acquisition, from the mid-$400 range preacquisition to the mid-$500 range today.”

So far, Wall Street’s assessment has not been as kind. The company’s once high-flying stock has plummeted down to earth, lately trading at around $21 per share — that’s down from highs of $53.65 last fall. A handful of analysts have begun pointing to the stock as a bargain, but many others have continued to express concern, arguing that the premiumpriced grocer will face significant challenges in the near term as shoppers, squeezed by high gas prices and rising food costs, begin searching for bargains at discount chains.

— MATTHEW ENIS