Alibaba-backed Lazada buys Singapore's RedMart
Lazada, a Southeast Asia-based e-commerce platform founded by Germany's Rocket Internet and recently acquired by Chinese e-commerce giant Alibaba Group, has bought Singapore-based online grocer RedMart.
The transaction is expected to close by the end of the year, according to a release. Financial terms of the purchase were not disclosed, but a report by Tech Crunch put the value at $30-40 million. RedMart's existing management team will remain in place and the company will operate independently after the acquisition.
Lazada hopes to benefit from access to RedMart's customer fulfillment capabilities in Singapore. The start-up delivers more than 15,000 grocery products, including fresh produce and frozen foods that it keeps fresh with its own fleet of delivery trucks. After the purchase, RedMart will accelerate its expansion into new product categories and seek to leverage Lazada's technology resources, seller base and community of third-party service providers.
"As a result of the complexity of our core business, online groceries, we have built a market-leading logistics infrastructure," said Roger Egan, co-founder and CEO of RedMart. "Through this partnership, we can further scale our logistics and tech platform to extend our product assortment and to offer an even more convenient service for our customers in Singapore."
RedMart has raised $54 million across several rounds of funding since its launch in 2011, most recently a $26.7 million bridge round last year. Its backers include Golden Gate Ventures, East Ventures and Lion Rock Capital, along with Singapore-based mobile internet and gaming platform Garena and Facebook co-founder Eduardo Saverin. The company was reported by Bloomberg to be looking for buyers earlier this year amid an increasingly challenging fundraising environment.
Lazada was set up by Rocket in 2012 and operates in six countries in Southeast Asia including Singapore. Alibaba paid about $1 billion for a majority stake in the company this April in a transaction that valued Lazada at $1.5 billion and provided part exits for several investors, including Rocket, AB Kinnevik and UK supermarket chain Tesco.
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