One of the highest-profile e-commerce startups is in talks to sell.
Online bulk-order wholesaler Boxed has received acquisition interest from grocery giant Kroger and several other major retailers, according to people with knowledge of the situation, with offers already in or expected to arrive next week for the New York-based startup. Should multiple companies make formal bids for Boxed, the company could move through a quick auction process, the people said.
Kroger, the $25 billion market cap chain based in Cincinnati, is one of the most likely candidates to acquire Boxed and one of the first to make an offer, the people familiar with the situation said. Costco, Target and Germany’s Aldi have also been mentioned as possible bidders among others, the people said, adding that initial offers likely range from $325 million to $500 million. Boxed had last raised money in 2016 at a valuation of $470 million, according to a Delaware filing under its corporate name, Giddy Inc.
Some of the companies interested in purchasing Boxed had not yet made formal offers as of Friday afternoon, the people said, and Boxed could still walk away from any deal. Should it stay independent, Boxed plans to raise an additional round of funding, said a source with knowledge of the company’s thinking. Boxed and Kroger both declined to comment.
A deal valued near Boxed’s most recent valuation or exceeding it would mean a big win for early investors including Greycroft, First Round, Signia Venture Partners, GGV Capital and DST Global.
Founded out of Huang’s New Jersey garage in 2013, Boxed took off as a digital alternative to stores such as Costco, BJ’s and Sam’s Club, offering about 1,600 different bulk goods from paper towels to potato chips. By signing exclusive deals with brands to only carry one of a certain type of item, Boxed was able to lock in prices more attractive to the company than those many retailers get, allowing the company to shun membership fees and provide free delivery across the continental U.S. on orders of more than $49.
After raising $100 million in January 2016, Boxed has more recently pushed into its own private brands and added a fast-growing business-to-business unit for offices. Box’s private label – something others such as Amazon and Costco have increasingly pushed – currently accounts for about 20% of its about $100 million in sales. With millions of users, Boxed’s average customer purchases between seven and 10 items per order, higher than
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