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Rocket Internet, the German company best known for quickly churning out clones of successful online businesses, has announced that it will create an e-commerce giant by merging five of its existing regional e-commerce services.
The new company, named GFG, will be made up of Dafiti (Latin America), Jabong (India), Lamoda (Russia & CIS), Namshi (Middle East), and Zalora (South East Asia & Australia), the company announced. The new business will have a global reach, although the regional sub-divisions will retain individual business models, inventories, branding, and so on, in order to best serve their respective regional markets.
This merger will bring improved efficiency and sharing of resources and expertise, Rocket Internet said. Here’s more from its announcement this morning:
The five GFG companies combine a unique expertise of developing leading online brands (e.g. Dafiti in Brazil), building the necessary infrastructure including where necessary last mile delivery networks (e.g. Lamoda Express in Russia), creating leading private label brands (e.g. “Lara Karen” and “Sangria” by Jabong in India and ”ZALORA” and “Ezra” by Zalora in South East Asia) and delivering best-in-class mobile applications (e.g. Namshi in Middle East).
The combination will improve global best practice sharing across functions, deliver economies of scale in sourcing international brands and marketing with global media channels, strengthen the private label efforts, enhance GFG’s ability to attract and retain top talent, accelerate development of technology platforms, and enable GFG to acquire a leadership position in growth market fashion e-commerce.
Put together, the five business have a combined valuation of €2.7 billion (approximately $3.5 billion), 4.6 million customers, and more than 7,000 employees.
This is a strategic move as Rocket Internet has long been rumored to be to eyeing an IPO. Fellow German e-commerce site Zalando announced yesterday its plans to list on the Frankfurt Stock Exchange later this year. The two companies share Investment AB Kinnevik as an investor.
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