Vertical mergers have never been illegal, ie it never started being illegal.

The combined Amazon + Whole Foods will have only a few percent of the US grocery market (around 3.x% if I recall correctly), which is highly fragmented. Walmart by comparison, has around 16% of the US grocery market.

Why would this be an illegal one? It has the potential to be a big force one day but nothing near that now and WF and grocery delivery both have lots of competition.