Amazon scoops up Zappos.com
The online retailing giant to purchase the online apparel and footwear retailer for $807 million in stock.
NEW YORK (CNNMoney.com) -- Amazon.com has reached an agreement to purchase Zappos.com, the online retailer known for its selection of shoes, for $807 million, according to a statement released Wednesday.
Zappos.com will get approximately 10 million shares of Amazon.com (AMZN, Fortune 500), which is equal to approximately $807 million, based on the average closing price for the 45 trading days ending July 17.
As part of the agreement, Seattle, Wash.-based Amazon.com will also give Zappos.com $40 million in cash and stock for its employees, on top of the $807 million purchase price of the company.
"We will continue to build the Zappos brand and culture in our own unique way, and we believe Amazon is the best partner to help us do this over the long term," said Tony Hsieh, CEO of Zappos, in a written statement.
In a letter to employees Wednesday, Hsieh said that there are no layoffs planned as part of the deal. "Your job is just as secure as it was a month ago."
The acquisition should be completed during the Fall of 2009, according to the statement.
Amazon.com is scheduled to report its second-quarter financial statement Thursday after the closing bell. The company is expected to report that earnings fell to 31 cents per share, down from 37 cents per share in the same quarter a year ago, according to a consensus estimate compiled by Thomson Reuters.
Shares of Amazon.com ended the regular trading session down 22 cents to $88.79 per share. In after hours trade, shares were up less than 1%.