Amazon To Acquire European Online Retailer

Amazon expanded its foothold retail market with its recent purchase of BuyVIP, a members-only retail club, for between $95.8 million and $109.4 million, according to Spanish daily Cinco Dias.

The acquisition represents Amazon's first step into the high-end retail space, since BuyVIP sells clothing, accessories, and decor items from designers such as Gucci, Calvin Klein, Diesel, Timberland, and Desigual. In September, Amazon purchased Amie Street, an online music store, and in June, it bought deal-a-day site Woot.

In July 2009, Amazon purchased Zappos, a large online shoe retailer, for 10 million Amazon shares or about $850 million. As a wholly owned subsidiary of Amazon.com, Zappos.com would not be folded into Amazon's operations.

"For Zappos, our vision remains the same: delivering happiness to customers, employees, and vendors. We just want to get there faster," said Tony Hsieh, chief executive of Zappos.com, in a letter to Zappos employees, at the time.

To date, Amazon has not publicly commented on the newest e-tailer to join its company. However, Amazon plans a news conference on Thursday. The transaction will have no consequences for BuyVIP's management team and employees, according to Cinco Dias.

BuyVIP, which has more than 7.5 million members in Spain, Italy, Germany, Austria, Poland, the Netherlands, and Portugal, sells high-end clothing at discounts of up to 70%, according to the retailer. The company, which has headquarters in Germany and Spain, has more than 500 strategic partnerships with well-known international fashion and lifestyle brands, BuyVIP said.

In 2009, BuyVIP had sales of €70 million or approximately $96 million, according to published reports. This year, the company is projecting revenue of more than €130 million, or about $179 million.

Before Amazon's acquisition, a consortium of private-equity companies was the primary owner of BuyVIP. This group included Cipio Partners, Kennet Partners, Debaeque, and the venture capital division of Bertelsmann AG.

Last year, German consumers spent €8.1 billion, or about $10.4 billion, online for clothing and footwear, according to Datamonitor. French, Italian, and British shoppers spent €3 billion, or about $4.1 billion, per nation, the research firm found.