PetSmart Buys Online Pet Retail Rival Chewy.com
“PetSmart has agreed to acquire online pet retailer Chewy.com in the latest deal by a brick-and-mortar titan for an e-commerce upstart.
On Tuesday, PetSmart—which was acquired a few years ago for $8.7 billion in a private equity backed leveraged buyout—said it agreed to buy Chewy.com to accelerate the company’s efforts to sell pet products and services both in physical stores and online in North America. The deal is expected to close by the end of PetSmart’s second fiscal quarter of 2017.
Regardless of the price, the acquisition is yet further proof that brick-and-mortar retailers want to get serious about how to compete in a world where more consumer spending is gravitating to online sources. That pivot in spending has resulted in retail bankruptcies at a pace that hasn’t been seen since the financial crisis and hundreds of store closures. The surviving chains are quickly realizing that a compelling e-commerce strategy is needed to better compete. And while many brick-and-mortar chains have bulked up on their own internally developed operations, e-commerce startups like Chewy.com have in many ways been more savvy and have successfully stolen market share.”
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