Walmart is acquiring e-commerce pure play Jet.com in a deal officials with the Bentonville, AR-based retailer said would allow the company to accelerate its online growth.
According to Walmart, the deal is valued at about $3 billion in cash, a portion of which will be paid over time. An additional $300 million of Walmart shares will also be paid over time as part of the transaction.
Doug McMillon, president and CEO of Walmart, said the Jet acquisition would allow Walmart to continue broadening its assortment while offering customers an easy and simple shopping experience.
“We believe the acquisition of Jet accelerates our progress across these priorities,” he said. “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.”
Walmart and Jet will maintain distinct brands, with Walmart.com focusing on delivering the company’s everyday low price strategy, while Jet will continue to provide a unique and differentiated customer experience with a curated assortment, company officials said.
According to Walmart officials, the acquisition will build on and complement the foundation already in place to serve customers across the Walmart app, site and stores and position the company for even faster e-commerce growth in the future by expanding customer reach and adding new capabilities.
The acquisition, which is subject to regulatory approval, has been approved by the boards of directors for both companies and is expected to close this calendar year.
Launched in 2015, Jet’s leadership team includes co-founder and CEO Marc Lore, and co-founders Mike Hanrahan and Nate Faust. Lore previously co-founded and led Quidsi, the parent company of e-commerce sites Diapers.com, Soap.com and Wag.com.
The Wall St. Journal reported that Lore would assume a leadership position on the e-commerce side of Walmart. Neil Ashe, Walmart’s top online executive, is expected to depart the company.
Jet is said to have a 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.
“We started Jet with the vision of creating a new shopping experience,” Lore said. “Today, I couldn’t be more excited that we will be joining with Walmart to help fuel the realization 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.”