Myntra acquires Jabong for $70 million

Online shopping company Myntra which is owned Flipkart has won the battle against Snapdeal, in acquiring the Jabong. Jabong, which is an online shopping company and was ready to get soled by its founders from previous year, and now they succeeded in doing so.
Jabong, was giving a big fight to its rival Myntra in sales during early 2014. So, to mesmerise the customers Flipkart has been spending crores of rupees on adds and discounts to lure customers. Hence, Flipkart today through its unit Myntra conquered Jabong with $70 million, so that it could maintain its podium position in India. Flipkart is gonna pay them in cash as reported by Global Fashion Group(GFG), which is the owner of Jabong. GFG told that, they were in search for a buyer since previous year, and they were in contact with Snapdeal, Amazon etc.
Binny Bansal co-founder of Flipkart said that ” 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”.
Decline of Jabong’s market started in the end of 2014. At, the end of 2014 a seviour decline in market value of Jabong was seen. Since, 2013 year was a profitable year for Jabong, because they gained $508 million from online retailing. Even though their sales increased in mid of 2014, but they collapsed because of a combination of leadership issue with funding crunch.
Now, Jabong could play a vital role to maintain the first position of Flipkart against its rivals like Amazon which is increasing at a rapid rate. Jabong offers more than 1,500 international high street brands, sports label, Indian ethnic and designer labels and over 150,000 styles from more than 1,000 sellers. So, these brands are now going to be merged in Myntra and it could also increase its market by targeting a vast audience.
From, this deal we could see that online market is full of mysteries, anything could happen here, that we couldn’t also think of. But, this one is gonna be beneficial for Flipkart in several ways(hope so!).