Myntra announced on Tuesday that it had acquired Jabong in a deal worth $70 million (in cash). This deal has come out of the blue, and many industry experts are probably scratching their heads. Most had expected and predicted that Snapdeal or Future Group were the front-runners to acquire Jabong (and GoJavas).
After the 'successful coup', Flipkart Founders Sachin Bansal and Binny Bansal took to Twitter to announce their 'spoils'.
While Flipkart (Myntra) has not yet clearly highlighted their thought process and why they decided to acquire the troubled Jabong, the ever-active Twitter junta dug deep and put forth interesting analysis on why Flipkart went ahead with the deal. Here are some of the highlights-
To unsubscribe from Jabong's emails
And then unite to defeat Dr. Batra
Myntra made a calculated decision based on recent events
'Jabong, I am your father.' *Heavy breathing* - Myntra
An acquisition is probably better than 'sleeping with the fishes'?
Another major announcement today was Amazon launching its Prime service in India and offering a 60-day trial period for customers. Amazon and Flipkart have a history of going head-to-head in trying to outdo each other and timing their announcements at almost the same time. In July 2014, Flipkart announced its $1-billion funding round led by Tiger Global and Naspers. Not to be outdone, just a day later Amazon announced that it had set up a $2-billion India-specific fund for expansions.
Popular Twitter celebrity and Founder of Fandromeda and TenTenTen Ramesh Srivats summed up both announcements with a witty tweet-
Implications of the deal?
Amazon recently announced that it was upping its India investments to $5 billion and with founder Jeff Bezos' strategy to win India at all costs, Indian e-commerce platforms have been feeling the heat to scale up and also the cold, with the 'funding winter' upon India.
YourStory had also recently explored how a merger among the big boys of e-commerce could be a route to battle 'foreign elements' like Amazon and Alibaba that are slowly closing in on India.
The bigger question in the near future for Indian consumers though is a more pertinent one- monopoly in a certain space generally means no more discounts. So,
- Just In
- Myntra acquires Jabong
- Jabong twitter reactions
- Why Myntra acquired Jabong
- Jabong $70M acquisition