Rocket Internet’s online grocery startup ShopWings merges with local rival in Australia

Photo credit: U.S. Department of Agriculture .

German startup juggernaut Rocket Internet announced today that ShopWings, its online grocery startup in Australia, is merging with local site Grocery Butlers.

The deal is not a leveraged buyout or a hostile takeover. It’s actually a merger of equals. Both startups will split equity 50/50 in the new company, which will be called ShopWings. Grocery Butler shall effectively cease to exist, as its site now redirects to ShopWings.

ShopWings utilizes an asset-light model, where it gets personal shoppers to purchase goods from local stores and deliver them to customers, similar to Singapore-headquartered Honestbee. The startup launched in February 2015 and operates in the cities of Sydney and Melbourne.

The new company will remain part of the Asia Pacific Internet Group (APACIG), a joint venture between Rocket Internet and Ooredoo. Other notable startups in APACIG are ecommerce store Daraz, budget hotel network Zenrooms, and on-demand cleaning service Helpling.

“The intention of the merger is really to bring in the best from both companies. ShopWings has a superior technology stack and it made sense to build and continue to use it […] On the other hand Grocery Butler, brings in a very complementary geographical footprint (strong presence in Melbourne and Brisbane),” Manutea Dupont, the current managing director for ShopWings, tells Tech in Asia.

Manutea adds that there’s been a bit of internal restructuring to ensure there’s no overlap of skills or responsibilities in the new venture. He says the team is also preparing for a new round of funding that will help scale the startup.

The team at ShopWings explains that industry revenues in Australia are projected to grow by more than 15 percent per annum in the coming years. A large chunk of that will go to virtual grocery stores, thereby signaling a “huge market opportunity.”