Softbank Said to Invest in Gilt to Help Luxury Retailer Expand in Asia

Softbank Corp. (9984) is close to an investment in Gilt Groupe Inc. that would value the members-only online retailer at about $1 billion and help it create a joint venture in Asia, two people familiar with the matter said.

Softbank, Japan’s third-largest wireless carrier, would provide about $15 million and is one of several investors in a funding round of more than $100 million, said two people who requested anonymity because the deal hasn’t been completed.

Gilt is among a growing number of e-commerce companies offering daily deals and limited-time sales. Daily-deal sites Groupon Inc. and LivingSocial together have been valued at as much as $8 billion, and Nordstrom Inc. (JWN) bought flash-sale site HauteLook Inc. last month for $180 million. The alliance with Tokyo-based Softbank gives it a toehold in Japan, the world’s second largest market for luxury goods, according to Bain & Co.

Gilt’s main business offers deals on luxury brands for as much as 70 percent off and gives members three days to decide whether to make a purchase. It specializes in apparel, home entertainment and luxury travel, offering brands such as Dolce & Gabbana and Giorgio Armani.

Jennifer Miller, a spokeswoman for Gilt, didn’t immediately respond to calls for comment. Takeaki Nukii, a Softbank spokesman in Tokyo, declined to comment.

Venture investing in U.S. Internet startups rose 28 percent in the first quarter from a year earlier, to $1.19 billion, the most invested in the first three months of the year since 2008.

Gilt Financing

Gilt raised about $15 million in debt financing from TriplePoint Capital in October, people familiar with the matter said at the time. The company previously raised at least $83 million from venture firms including General Atlantic LLC and Matrix Partners.

Softbank is an investor in some of Asia’s biggest Internet companies including Yahoo Japan Corp. (4689), operator of the nation’s most-visited Web portal, and Alibaba Group Holding Ltd., China’s biggest e-commerce company. Softbank is also the biggest shareholder in Renren Inc., the Chinese social-networking service that filed to go public last week.

Business Insider reported on its website in February that Gilt was raising as much as $100 million at a valuation of about $1 billion.

To contact the reporters on this story: Joseph Galante in San Francisco at jgalante3@bloomberg.net; Ari Levy in San Francisco at alevy5@bloomberg.net; Serena Saitto in New York at ssaitto@bloomberg.net

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