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China's Alibaba acquires Vendio Services

India Infoline News Service | Mumbai |

Acquisition integrates AliExpress and Vendio e-commerce services into a complete solution for small businesses in the U.S.

Alibaba.com, the world's leading e-commerce company for small business, has entered into an agreement to acquire Vendio Services, Inc., a multi-channel e-commerce company providing a one-stop solution for small businesses that are selling online across multiple channels . From the Vendio Platform, merchants can source products from Alibaba.com's trusted supplier network and sell through channels such as eBay, Amazon, and their own Vendio-supported store. This platform is offered on Software as a Service (SaaS) cloud-computing model to help businesses increase their sales while managing costs to enhance their profit margin.

Through this acquisition, Alibaba.com gains access to more than 80,000 targeted small businesses in the U.S. with potential sourcing needs from suppliers on Alibaba.com's sourcing platform and AliExpress (www.aliexpress.com), a wholesale transaction platform operated by Alibaba.com. In addition, the acquisition will provide access to e-commerce storefronts and multi-channel selling services for AliExpress customers looking to reach consumers online through the Vendio Platform. AliExpress and Vendio customers are able to source efficiently from the 5 million+ products available on AliExpress and then sell goods through Vendio on the retail marketplaces of their choice around the world.

With the acquisition, Alibaba.com will connect AliExpress directly with Vendio through back-end integration, creating an AliExpress tab within the Vendio Platform. This integration allows Vendio users to easily access a private sourcing experience within their Vendio inventory and sales management interfaces. Exclusive guarantees, promotions and special deals on AliExpress wholesale products will also be available to Vendio users.

AliExpress complements Vendio by strengthening the first step in the business cycle for small businesses: how to locate products for sale. According to a recent survey, more than 80 percent of Vendio customers have never used online supplier services and nearly 90 percent have never tried to take advantage of import-export. This integration creates an opportunity for Vendio customers to expand their supply chain and lower their cost through instant, free access to the more than 1.4 million supplier storefronts on Alibaba.com and AliExpress. Now Alibaba.com and Vendio members have access to complete e-commerce solutions to meet their sourcing, buying and selling needs through an integrated set of tools and features.

"At Alibaba.com, our goal is to make it easier for our customers around the world to do business by providing solutions that increase margins, productivity and competitiveness through e-commerce," said David Wei, chief executive officer of Alibaba.com. "We continue to look for synergies and investment opportunities to grow our customer base, acquire additional technology and add new applications that will help our customer base grow and prosper. Vendio is our first acquisition in the U.S. and a strong strategic fit across all three areas, and I am confident that our complementary businesses will create enhanced opportunities for our customers."

"We identify with Alibaba.com's vision of creating a seamless global e-commerce experience for business owners," said Mike Effle, COO of Vendio. "We are particularly impressed by Alibaba.com's deep commitment to creating immense value for small businesses. Efficiently integrating Alibaba.com's extensive supplier base will allow Vendio's merchants to earn higher profit margins while providing unique and competitively priced products from around the world to their customers. The increased efficiency and product breadth will yield additional positive effects for the marketplaces we support and throughout the entire e-commerce ecosystem."

The acquisition is part of the US$100 million investment plan for AliExpress that Alibaba.com announced in April 2010. It is expected to close in July 2010. After the closing, Vendio will become a new business unit within Alibaba.com and will retain its own brand name and operations. Mike Effle, current Vendio COO, will assume the role of the Vendio CEO and Rodrigo Sales, current Vendio CEO, will become a strategic advisor to the company.

Rothschild was the financial adviser to Alibaba.com for this transaction and Pacific Crest Securities was the adviser to Vendio for this transaction. Financial terms were not disclosed.



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