Walmart Stores, Inc. (NYSE:WMT) has revealed that it is currently in acquisition talks with Jet.com.
Jet.com is a discount retailer that was launched to compete against online retail firms such as Amazon.com, Inc. (NASDAQ:AMZN). However, the discount retailer might end up being acquired by Walmart if the deal goes through. If successful it will also be one of Walmart’s largest deals so far. The acquisition is very strategic for the retail giant because it will fit into its online retail expansion plan which will, in turn, give it a more competitive edge against companies such as Amazon. It will also allow Jet.com to pursue its plan of outperforming Amazon at a faster pace.
Financial Terms Yet Not Defined By Walmart
Jet.com has not been in the online retail game as long as its rivals but it has been doing quite well. Sources familiar to the deal claim that the two companies are in the early stages of negotiations and the financial terms are not yet defined. Jet.com has been employing different competitive strategies including novel pricing software. The acquisition will be adding on to those efforts by including a wide range of markets and customer information from Walmart.
Reporters from the Wall Street Journal approached Walmart representatives regarding the acquisition talks but the representatives did not reveal any details. The same happened when representatives from Jet.com were approached but they did not make any comments thus suggesting that the two firms want the deal to be treated as a very private affair. Jet.com was founded by Marc Lore, who was the same person behind Diapers.com which was acquired by Amazon for $550 million.
Walmart now wants to take a swing at an acquisition that it believes will be pivotal towards achieving a strong online presence. The firm has so far spent its resources towards developing an online presence that will match its dominance in offline retail. Roughly three months ago, Doug McMillon, president and CEO of Walmart stated that online progress has been slow and shoppers are more inclined to shop at Amazon.