BENTONVILLE, Ark., Aug. 8 (UPI) -- Wal-Mart announced plans Monday to acquire Jet.com for $3.3 billion as the world's largest retailer seeks to strengthen its e-commerce operation against market leader Amazon.
Wal-Mart, headquartered in Berntonville, Ark., will pay $3 billion in cash and $300 million in shares to be paid over an undisclosed time period, the retailer said in a statement. It's Wal-Mart's largest ever deal in the United States.
Jet.com, based in Hoboken, N.J., surpassed $1 billion in gross merchandise sales since it started a year ago. It processes an average of 25,000 orders a day and is adding 400,000 shoppers monthly, according to a release.
Wal-Mart's website had $13.6 billion in annual revenue, which was 3 percent of its $482 billion in total revenue, including at it 11,527 stores. Amazon's sales were $107 billion last year, including its Web-service business, according to CNBC.
"We're looking for ways to lower prices, broaden our assortment and offer the simplest, easiest shopping experience because that's what our customers want," Doug McMillon, Walmart's CEO, {link:said in a statement.
WalMart has been trying to expand past its brick-and-mortar operation with new offices in Silicon Valley and e-commerce distribution centers. Like Amazon Prime, it debuted an annual subscription service that includes shipping.
"Wal-Mart has definitely put its stake in the ground saying, 'We're going to be winning in e-commerce,'" said Joseph Feldman, an analyst at Telsey Advisory Group to Bloomberg. "Amazon should be concerned about what Wal-Mart is doing."
Wal-Mart and Jet will maintain distinct brands, with Wal-Mart focusing on goods at low prices "every day" and Jet still providing a more "curated" assortment of products, the companies said. Also, "Walmart and Jet will leverage innovative technology solutions from both companies to develop new offerings to help customers save time and money," the release said.
Jet founder Marc Lore, 45, will continue to play a key role at the company, according to the companies.
"We started Jet with the vision of creating a new shopping experience," Lore said in a statement. "Today, I couldn't be more excited that we will be joining with Walmart to help fuel the realization of that vision. The combination of Walmart's retail expertise, purchasing scale, sourcing capabilities, distribution footprint, and digital assets – together with the team, technology and business we have built here at Jet – will allow us to deliver more value to customers."
Lore cofounded Quidsi, which runs the e-commerce sites Diapers.com, Soap.com, and Wag.com, but sold it to rival Amazon in 2010 for $550 million. He debuted Jet.com in 2015.
