The German retailer of online fashion Zalando said it will acquire local rival About You for 1.1 billion euros ($1.2 billion) to create a European platform that can better compete with China’s e-commerce giants. The operation is expected to close in 2025.
Berlin-based Zalando, which plans to bid for the takeover, and About You said it would recommend its shareholders accept the offer.
“Zalando and About You have decided to come together to better serve the needs of customers and partners through their combined and distinct offerings,” the companies said in a joint statement. This will “enable the combined group to cover a greater share of the European fashion and lifestyle e-commerce market”.
Zalando offers 6.50 euros per share for About You. Shares of About You rose 64% on the Frankfurt Stock Exchange, reaching 6.40 euros, while those of Zalando fell by around 5%. According to the release, the combined group will be able to “better serve the specific needs of customers and partners.”
Brands and retailers will benefit from a unified platform with improved logistics, software and service offerings. The deal comes as European e-commerce sites are increasingly concerned about the explosive growth in popularity of online retailers Shein and Temu, founded in China and known for offering products at low prices.