Tue, Nov 09, 2010 - Page 10 News List

Amazon.com may be near agreement to buy Diapers.com


Amazon.com Inc is near an agreement to buy Quidsi Inc, the owner of Diapers.com and Soap.com, for US$540 million, two people with knowledge of the matter said.

One of the sources said an announcement might come as early as yesterday. The source declined to be identified because the deal was not yet public.

Quidsi, which expects to ship 500 million diapers this year, will help Amazon cater to new parents and gain expertise in warehouse management and low-cost shipping. Amazon CEO Jeff Bezos, 46, bought Zappos.com Inc last year for US$1.2 billion to expand sales of shoes and clothing and gain share against other e-commerce providers such as EBay Inc.

The purchase also removes a competitor for Seattle-based Amazon, which began selling diapers in the middle of 2006, a year after Diapers.com debuted. Amazon began offering a free three-month trial of Amazon Prime to mothers ordering diapers and other baby items to counter Diapers.com’s free shipping.

Quidsi expects sales to increase 67 percent to US$300 million this year, compared with the 39 percent revenue growth analysts predict for Amazon.

Quidsi’s revenue may rise to US$1.3 billion in 2012, Quidsi CEO Marc Lore said earlier this year.

Amazon, which had US$5.9 billion in cash and short-term securities at the end of September, is on an acquisition spree. In June, it bought Woot.com, a site that offers a daily discounted item. It also agreed last month to purchase BuyVIP, a fashion site, for an undisclosed price to broaden its geographical reach into Spain, Italy and Germany.

Quidsi also received a purchase offer from Wal-Mart Stores Inc, according to Fortune, which reported the Amazon deal on Saturday.

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