Retail in Asia

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India’s Flipkart buys Jabong for $70 million

Jabong Screen Cap

India’s biggest e-commerce firm Flipkart is buying domestic online fashion retailer Jabong from Global Fashion Group for $70 million in cash, the latest consolidation move in the country’s e-commerce sector as competition intensifies.

Flipkart unit Myntra, India’s largest online fashion retailer which is buying Jabong, said on Tuesday the two sites will have a combined base of 15 million monthly active users. Global Fashion Group is backed by Germany’s Rocket Internet and Sweden’s Kinnevik.

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Niche e-commerce players in India are facing greater competition from both domestic rivals and the likes of Inc, at a time when industry valuations have begun to cool.

Rocket Internet had flagged earlier this year that business was tough in India, warranting more investment by Global Fashion Group.

The deal puts Myntra, which itself was bought by Flipkart for about $300 million last year, in a stronger position to take on Flipkart’s biggest local rival Snapdeal and Amazon, which has pledged to invest over $5 billion in India to boost market share in the country.