Rocket Internet, the founder of Southeast Asia’s leading ecommerce platform Lazada, is going to sell its unprofitable Asian fashion portal Zalora, according to techcrunch.com.
The tech news website said on Friday that Rocket Internet is in the process of selling its businesses in Thailand and Vietnam to cut down on costs. A local conglomerate has agreed to buy Zalora Thailand for USD10 million although the deal is not closed yet, said the news portal. However, it’s still unknown who is the acquirer of the Vietnam business.
Founded in 2007, Rocket Internet specializes in launching e-commerce startups. It focuses on five industry sectors of online and mobile retail services which include Food & Groceries, Fashion, General Merchandise, Home & Living and Travel.
The Berlin-based internet incubator teamed up with Investment group AB Kinnevik in 2014 to set up a fashion e-commerce group – Global Fashion Group which combines five emerging market fashion sites Dafiti, Lamoda, Jabong, Zalora and Namshi.
On 12 April, Rocket Internet sold a 9.1 percent stake in its South-East Asian general merchandise marketplace Lazada to Alibaba for USD 137 million. In addition, Alibaba is investing USD 500 million into Lazada, at a valuation of USD 1.5 billion, making Alibaba the controlling shareholder. Rocket Internet will hold 8.8 percent stake in Lazada after the transaction which represents over 15 times as much as its total investment of EUR18 million (USD20.5m).
Like Lazada, Zalora has been shopped to investors and potential acquirers for some time, according to techcrunch.com. However, it’s selling the online fashion portal piece by piece this time instead of selling it as a whole like Lazada.
Founded in 2012, Zalora has a presence in Singapore, Indonesia, Malaysia & Brunei, the Philippines, Thailand, Vietnam, Hong Kong and Taiwan where it operates as Zalora and in Australia and New Zealand where it operates as The Iconic.
The online fashion retailer registered a net income of EUR208 million in the fiscal year 215, a 78 percent growth compared with the previous year. However, net loss increased 28 percent to EUR104.2m from EUR81.3m in the previous year.