Flipkart-owned Myntra today said it has acquired Jabong from Global Fashion Group for an undisclosed amount, a move that will mark further consolidation in India’s booming e-commerce industry.
Myntra, which itself was acquired by Flipkart in 2014 in an estimated Rs 2,000 crore deal, will have access to a combined base of 15 million monthly active users.
No financial details were disclosed.
“Fashion and lifestyle is one of the biggest drivers of ecommerce growth in India. We have always believed in this segment, and Myntra’s strong performance has reinforced this faith,” said Binny Bansal, co-founder and CEO of Flipkart.
“This acquisition is a continuation of the group’s journey to transform commerce in India. I am happy that we will now be able to offer to millions of customers a wide variety of styles, products and a broad assortment of global as well as Indian brands,” Bansal said.
Jabong has been in the market for a sell-off and was in discussion with companies including Future Group, Snapdeal and Aditya Birla-owned Abof among others.
Jabong was founded in 2012. In September 2014, its investor, Rocket Internet merged Jabong with four other online fashion retailers in Latin America, Russia, the Middle East, South-east Asia and Australia to create Global Fashion Group (GFG).
Swedish investment firm Kinnevik also owns a large stake in Jabong’s parent Global Fashion Group.
While Jabong has managed to reduce losses by reducing discounts, both Kinnevik and Rocket Internet seem unwilling to infuse fresh capital and are believed to be keen to exit.
According to the Internet and Mobile Association of India, e-tailing has grown at 57% year-on-year, moving from Rs 24,046 crore to Rs 37,689 crore between the December 2014 and December 2015. This is further estimated to touch Rs 72,639 crore by end of 2016.
Fashion is the second largest category in India, after electronics, at $16 billion annualised revenues. It makes for almost 30% of ecommerce transactions.
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