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AMAZON.COM TAKES 46% STAKE IN DRUGSTORE.COM AT LAUNCH

Amazon.com Inc yesterday revealed that it has taken a 46% stake in the much-hyped online drug retailer Drugstore.com Inc, which goes live on the web today. Amazon.com CEO Jeff Bezos made the announcement at the office of Kleiner Perkins Caufield & Byers, which provided both companies with early funding. He did not disclose the cost of the investment but said Amazon will promote Drugstore heavily on its own site. Amazon.com recently raised $1.25bn in a private debt offering of 4.75% convertible subordinated notes and said it planned to use the money to expand beyond its core business of selling books, videos and music to become more of a general retailer (01/29/99). Drugstore.com is headed by Peter Neupert, a veteran Microsoft Corp executive who, as head of new media, was responsible for Slate and Microsoft’s part in the MSNBC cable television channel, before leaving to head Drugstore.com in July last year. The company was established in Redmond, Washington just last April by ex-Oracle executive Jed Smith (07/28/98). It will offer prescription and non-prescription drugs as well as other health and beauty products. Amazon.com, Drugstore.com and Kleiner Perkins are also connected in that they are all named in lawsuits brought by Wal-Mart Stores Inc last October over the alleged stealing of trade secrets by staff who moved from Wal-Mart to Amazon and Drugstore.com.

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CBR Staff Writer

CBR Online legacy content.