The buy will help Flipkart to compete with Amazon in India
Indian online retailer Flipkart has bought a startup Letsbuy.com in a bid to consolidate its position in the rapidly growing ecommerce space.
Though Flipkart did not disclose the value of the deal, a person privy to the deal pegged it at around $20m to $25m.
The deal will give Flipkart, which deals from books to movies to mobile phones, a larger catalogue of electronics products and will also help the company shore itself up following Amazon’s entry into India last week.
Letsbuy’s founders and over 350 employees will continue to function independently, Flpkart said in a statement.
Flipkart co-founder and Chief Executive Sachin Bansal in a statement said this acquisition fits into Flipkart’s strategy of building dominant shares in all categories it operates in.
"This acquisition opportunity came at a very attractive price for us and the timing has also been ideal. The synergies will now allow us to accelerate faster and get to a share similar to what we enjoy in the online books category," Bansal added.
The acquisition was done in a combination of cash and equity.