Flipkart-owned Myntra has today completed the acquisition of rivals Jabong. With this, Flipkart has now become India’s biggest fashion retailer, and will take the competition to Amazon Fashion. Moments after the announcement, Flipkart chairman Sachin Bansal tweeted, “Welcome @JabongIndia to the @Flipkart family. We’ll create history together.” Also Read - iPhone SE gets cheaper on Flipkart only for today: Get over Rs 11,000 flat discount
Welcome @JabongIndia to the @Flipkart family. We’ll create history together. Also Read - iPhone 12 for iPhone 11 launch price at Flipkart Big Saving Days sale, iPhone 12 Mini alse sees discountAlso Read - Flipkart Big Saving Days sale begins for Plus members: Check top 5 deals on smartphones
Sachin Bansal (@_sachinbansal) July 26, 2016
binnybansal (@binnybansal) July 26, 2016
Jabong is believed to have been in talks for an acquisition since the past couple of years. As per reports, the likes of Amazon India, Paytm, Snapdeal, Future Group and Aditya Birla-owned Abof were believed to have shown some manner of interest in buying Jabong.
“The acquisition of Jabong is a natural step in our journey to be India’s largest fashion platform. We see significant synergies between the two companies especially on brand relationships and consumer experience,” said Ananth Narayanan, CEO, Myntra. “We look forward to working with the talented Jabong team to shape the future of fashion and lifestyle ecommerce in India.”
Global Fashion Group (GFG), Jabong’s parent company announced that the deal is worth $70 million, and Flipkart is paying the entire amount in cash. The company has also announced that the acquisition deal is expected to close sometime this quarter. In comparison, about two years ago, Flipkart had paid in excess of $300 million to buy Myntra. Post the acquisition, Myntra and Jabong will both have a month active user base of over 15 million.
It has not been a great year for Jabong, which has seen high-profile exits, including co-founders Arun Chandra Mohan and Praveen Sinha. Last year, the company roped in former Benetton exec Sanjeev Mohanty as new CEO, and recently it hired former eBay India head Muralikrishnan B as COO. The fashion retailer has recently managed to cut down its losses from Rs 159.5 crore in 2014 to Rs 46.7 crore in 2015. Earlier this year, Jabong’s parent company GFG was able to secure funding of over Rs 2,000 crore from Rocket Internet.