Dive Brief:
- Kroger has sold Vitacost.com, its online health and wellness subsidiary, to iHerb, the supermarket chain announced Friday. Terms of the deal, which closed Thursday, were not disclosed.
- The transaction reflects Kroger’s ongoing effort to review its non-core assets as it looks to sharpen its focus on its central grocery business, Kroger interim CEO and Chairman Ron Sargent said in a statement.
- This is the latest move by Kroger to pare back its e-commerce business as it focuses more on store operations.
Dive Insight:
Kroger acquired Vitacost.com for $280 million in mid-August 2014, noting at the time that the vitamin seller “brings to Kroger its strong position as one of the largest pure eCommerce companies in the nutrition and healthy living market, a team with extensive eCommerce experience, and a substantial platform that includes technology and ship-to-home fulfillment centers to serve customers in all 50 states and internationally.”
Founded in 1996, iHerb says it offers vitamins, minerals, supplements and other health and wellness products from nearly 2,000 brands to customers in 180 countries.
“We believe iHerb is well positioned to help Vitacost reach its full potential outside of Kroger, and we are working together to ensure a smooth transition for associates and customers,” Sargent said.
The sale of Vitacost.com comes as Kroger broadly overhauls its online operations. Last year, the company said it would dial back its investments in the automated fulfillment network it built in partnership with U.K.-based robotics company Ocado. Kroger is instead stepping up its use of its stores to fulfill digital orders.
Following its failed merger with Albertsons, Kroger last year closed dozens of stores and laid off hundreds of employees in an effort to cut costs throughout its business.
