Boxed Wholesale, which sells snacks, paper towels and other household products in bulk, rejected a $400 million acquisition offer from Kroger Co. and will pursue a new funding round to remain private, according to a person familiar with the matter.
The New York-based startup’s board voted last week to reject the offer from the largest supermarket chain in the U.S., said the person, who asked not to be identified because the discussions were private. Boxed also had preliminary talks with Amazon.com Inc., Target Corp. and Costco Wholesale Corp., but Kroger was the only company to submit a bid, the person said. Boxed has a $470 million valuation, the person said.
The Kroger rejection puts Boxed back on the original path set out by Chief Executive Officer Chieh Huang, who has said he wants to remain independent and eventually go public. Boxed has differentiated itself from Amazon by offering a limited selection of household products in bulk sizes, as well as an inexpensive house brand of trash bags, paper plates and other items. The narrower scope lets the company sell more orders using fewer people and less space than a retailer with a bigger inventory.
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