Wal-Mart Stores, Inc. and Jet.com, Inc. have entered into a definitive agreement for Walmart to acquire Jet for approximately $3 billion in cash, a portion of which will be paid over time. Additionally, $300 million of Walmart shares will be paid over time as part of the transaction.
Walmart said the acquisition will ‘build on and complement the significant foundation already in place to serve customers across the Walmart app, site and stores, and position the company for faster e-commerce growth in the future by expanding customer reach and adding new capabilities’.
The deal, which is subject to regulatory approval, has been approved by the boards of directors OF both companies and is expected to close this calendar year.
Jet is one of the fastest growing e-commerce companies in the US. It has a growing customer base of urban and millennial customers with more than 400,000 new shoppers added monthly and an average of 25,000 daily processed orders.
Walmart said the acquisition will ‘infuse us with fresh ideas and expertise, as well as an attractive brand with proven appeal, especially with Millennials: the first generation of true digital natives’.
Doug McMillon, president and CEO, Wal-Mart Stores, Inc. commented: “We’re looking for ways to lower prices, broaden our assortment and offer the simplest, easiest shopping experience, because that’s what our customers want.
”We believe the acquisition of Jet accelerates our progress across these priorities. Walmart.com will grow faster, the seamless shopping experience we’re pursuing will happen quicker, and we’ll enable the Jet brand to be even more successful in a shorter period of time. Our customers will win. It’s another jolt of entrepreneurial spirit being injected into Walmart.”
Jet co-founder and ceo Marc Lore added: “We started Jet with the vision of creating a new shopping experience. Today, I couldn’t be more excited that we will be joining with Walmart to help fuel the realisation of that vision.
“The combination of Walmart’s retail expertise, purchasing scale, sourcing capabilities, distribution footprint, and digital assets – together with the team, technology and business we have built here at Jet – will allow us to deliver more value to customers.”
Walmart and Jet will maintain distinct brands, with Walmart.com focusing on delivering the company’s Everyday Low Price strategy, while Jet continuing to provide a differentiated customer experience with curated assortment.
Walmart operates 11,527 stores under 63 banners in 28 countries and e-commerce websites in 11 countries. With fiscal year 2016 revenue of $482 billion, it employs more than 2.3 million staff worldwide.