Market Overview

Amazon Poised For A Big 2014 After A Quiet Acquisition Year

2013 was a bit of an anomaly for the online retail giant Amazon (NASDAQ: AMZN).

It was the company's smallest year in terms of acquisitions, but the company could be poised to have a big 2014.

In 2013, Amazon only spent $195 million in acquisitions, the lowest amount for the company since 2007. Amazon's biggest purchase was Goodreads, a book recommendation service that Amazon bought for $150 million.

This is a big departure from from previous year. For instance, Amazon purchased warehouse robotics company Kiva Systems for $678 million in 2012 (perhaps the company helped with Amazon's new drone delivery program?). In 2011, Amazon spend $771 million, and bought diapers.com parent company Quidsi for $540 million.

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Since Amazon is such a big player in the mergers and acquisition arena, many are hypothesizing the company is planning on having a big 2014 by buying a firm with expertise in a new area, or buying out a smaller competitor.

Re/Code's Jason Del Rey writes that Amazon is quite serious about its burgeoning grocery delivery service, expanding existing services in Los Angeles and San Francisco in addition to Seattle. But the service doesn't exist on the East Coast yet, and Del Rey thinks a company like FreshDirect or Peapod could really help Amazon infiltrate that region.

Or Amazon could be planning on entering the growing Israeli cyber-security industry. According to Haaretz, Amazon announced they were opening new marketing and customer service offices in Israel -- and conducted a number of discussions with new cyber-security firms in the area. The purpose of those talks, apparently, was to discuss an acquisition and use it as a research and development base.

All of the firms that Amazon spoke to were focused in cloud-computing information security — these firms try to improve the security around sensitive data thats stored remotely for both regular customers and enterprise clients.

If Amazon ramps up its acquisition levels to match previous years, like many are hypothesizing, 2014 should be a big year for the online retail giant.

Posted-In: Haaretz Jason Del RayNews M&A Tech Media General Best of Benzinga

 

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