Amazon.com Increases drugstore.com Stake

Amazon.com Monday invested another $30 million
in drugstore.com, bringing its total stake
in the online pharmacy to almost 28 percent.


With the agreement, drugstore.com (DSCM)
will pay the giant e-tailer $105 million over the next three years to bundle
a number of the companies’ shopping features and create a shopping “tab” at
Amazon.com.


In addition to being featured on Amazon.com,
(AMZN)
the deal will integrate drugstore.com products into Amazon’s 1-Click shopping feature. Other integration, including search capabilities, are planned for later.


Amazon.com originally acquired a minority stake in drugstore.com in August
1998. In the past, Amazon.com has introduced drugstore.com to Amazon.com
customers by offering temporary links on the Amazon.com home page and by
distributing drugstore.com gift certificates to Amazon.com customers.


“Our partnership has been so successful and so valuable for customers that
it makes sense for us to take
it to a new and enhanced level,” said Peter Neupert, president and CEO of
drugstore.com. “This deeper
integration with Amazon.com demonstrates both companies’ ongoing commitment
to constantly evolve and
improve the customer experience.”


With the deal, Amazon.com looks to expand its dynasty by investing in
popular e-tailers. In addition to its investment in drugstore.com,
Amazon.com has invested in Pets.com, Homegrocer.com, Gear.com and Ashford.com.

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