Amazon will buy US retailer Target, analyst says - TechCentral

Amazon will buy US retailer Target, analyst says

Amazon.com’s shake-up of the retail landscape may not be over, according to one well-known technology analyst.

The Internet giant will acquire Target, Loup Venture co-founder Gene Munster wrote in a report highlighting eight predictions for the technology industry in 2018. Amazon made waves in retailing last year with its US$13.7bn purchase of Whole Foods Market.

“Target is the ideal offline partner for Amazon for two reasons: shared demographic and manageable but comprehensive store count,” Munster wrote, noting both companies focus on mothers and families. “Getting the timing on this is difficult, but seeing the value of the combination is easy.”

Market share numbers suggest a deal would be approved by regulators, and Wal-Mart Stores would still have a larger share than an Amazon-Target combination, Munster said. He estimated a takeout valuation of $41bn, or a 15% premium to Target’s current value.

Predicting Amazon’s next deal has become a common theme for analysts. In November, DA Davidson analyst Tom Forte wrote that Lululemon Athletica may be attractive to the online retailer, while Citigroup analyst Paul Lejuez recently catalogued a host of potential targets, including Abercrombie & Fitch, Bed Bath & Beyond and Advance Auto Parts.

Still, Amazon may not just be interested in retail deals. Last month, CFRA bank analyst Ken Leon wrote that he foresees the Internet company company buying a small- or mid-sized bank in 2018.  — Reported by Beth Mellor, (c) 2017 Bloomberg LP

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