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Lazada goes grocer shopping

SINGAPORE — Seven months after Chinese tech giant Alibaba bought a controlling stake in it, Singapore e-commerce company Lazada has acquired homegrown e-grocer RedMart in a deal that the companies said will allow them to benefit from each other’s technological and operational infrastructure, as well as customer network.

A screenshot of Singapore e-commerce company Lazada webpage.

A screenshot of Singapore e-commerce company Lazada webpage.

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SINGAPORE — Seven months after Chinese tech giant Alibaba bought a controlling stake in it, Singapore e-commerce company Lazada has acquired homegrown e-grocer RedMart in a deal that the companies said will allow them to benefit from each other’s technological and operational infrastructure, as well as customer network.

The companies did not provide the size of the deal. The transaction is expected to be completed by the end of this year, and RedMart – led by its current management — will continue to operate independently after the transaction, the companies said in a joint statement.

RedMart, one of the earliest players in the online grocery market, was founded in 2011 as a pure-play online-only grocer. RedMart has no storefront, operating out of a 100,000-square foot warehouse, CEO Roger Egan told Tech in Asia late last year. The company told TODAY that it has close to 100 delivery vehicles and more than 700 employees.

The partnership will allow Lazada to benefit from RedMart’s strong fulfilment capabilities in Singapore, the companies said. It will also accelerate RedMart’s expansion into new product categories and further enhance its service offering to customers by leveraging Lazada’s seller base, ecosystem of third-party service providers and advanced technological resources, they said.

“Through this partnership, we can further scale our logistics and tech platform to extend our product assortment ... The capital flexibility provided through this deal will go towards innovating to delight our customers,” said Mr Egan in the statement.

Lazada Group CEO Maximilian Bittner added: “As part of our growth strategy, we are always looking for ways to serve our customers better by adding new product categories and improving our service offering.”

According to CrunchBase, which provides information on startups and their funding, RedMart has garnered about US$55.1 million (S$76 million) in six rounds of funding. Facebook co-founder Eduardo Saverin is one of its investors.

Lazada, founded by Germany’s Rocket Internet in 2012, has a presence in Indonesia, Malaysia, the Philippines, Singapore, Thailand and Vietnam. In April, Alibaba bought a controlling stake in Lazada Group for about US$1 billion.

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