Amazon to buy Diapers.com owner Quidsi for $500M

Nov 08, 2010

(AP) -- Expanding its online retail empire, Amazon.com Inc. said Monday it is buying Quidsi, the owner of Diapers.com and Soap.com, for $500 million in cash.

Amazon said Quidsi will continue to operate independently after the acquisition, which is expected to close in December.

Amazon plans assume about $45 million in debt and other obligations as part of the deal, which has been approved by Quidsi's shareholders.

Soap.com sells health, beauty and cleaning products online, while Diapers.com sells baby-care items, including food and maternity wear. And Quidsi recently launched BeautyBar.com, which sells higher-end skin care, makeup and other products online.

The deal "positions Amazon to dominate the baby category," said Cowen and Co. analyst Jim Friedland in a note to investors. Quidsi, he added, is expected to generate $300 million of revenue in 2010, up 67 percent year-over-year.

The acquisition of Quidsi "will help Amazon become a category killer in the baby segment," Friedland wrote. "In our view - and this is coming from a dad with a 9-week-old - Diapers.com has been beating Amazon at its own game in the nonapparel baby category."

Diapers.com usually has better selection, better stock levels and lower prices, he said. The acquisition thus eliminates a key rival, and "prevents online and offline rivals from buying the asset to compete more aggressively in the baby category," Friedland said.

Amazon, based in Seattle, bought popular online shoe retailer Zappos.com, for $850 million last year. Zappos also operates independently as a unit of Amazon.

Shares of Amazon slid $1.30 to $169.47 in morning trading.

Explore further: Strong iPhone 6 demand boosts Taiwan export orders

not rated yet
add to favorites email to friend print save as pdf

Related Stories

Amazon purchasing BuyVIP online sales club

Oct 07, 2010

Amazon announced on Thursday it is acquiring BuyVIP.com, a private online sales club with more than six million members in Austria, Germany, Italy, the Netherlands, Poland, Portugal and Spain.

Amazon 2Q profit falls with Toys R Us settlement

Jul 23, 2009

(AP) -- Amazon.com Inc. said Thursday that its second-quarter earnings fell while sales rose, due to a $51 million payment to settle a long-standing dispute with former partner Toys R Us. The profit still beat Wall Street ...

Amazon 3Q profit jumps 16 percent, but costs rise

Oct 21, 2010

(AP) -- Amazon.com Inc. saw earnings grow in the third quarter as shoppers bought more goods and services, yet costs also rose because the company is having to build new centers to fulfill those orders. Shares ...

Recommended for you

Amazon, Simon & Schuster sign book retail deal

4 hours ago

Amazon has reached a deal with American book publisher Simon & Schuster, the companies said, though the e-commerce giant remains at loggerheads with France's Hachette over e-book pricing.

Facebook sues law firms, claims fraud

15 hours ago

Facebook is suing several law firms that represented a man who claimed he owned half of the social network and was entitled to billions of dollars from the company and its CEO Mark Zuckerberg.

IBM 3Q disappoints as it sheds 'empty calories'

15 hours ago

IBM disappointed investors Monday, reporting weak revenue growth again and a big charge to shed its costly chipmaking division as the tech giant tries to steer its business toward cloud computing and social-mobile ...

User comments : 0