JPMorgan is reportedly see buyers for FreshDirect, indicating they want out of their investment into the online food retailer recently affected by delivery issues, based on a new report.
While the grocery store’s largest investor appears for potential buyers, Amazon and Walmart, both invested within the grocery business, recently vetted FreshDirect’s financial and performance information for the third time, based on the newspaper citing sources aware of the matter.
In 2016, Fresh Direct LLC, which serves residents and offices throughout the New York City metropolitan area, received a $189 million in an investment round led by JPMorgan Asset Management.
The company was once seen as ruling the online grocery business before competition within grocery e-commerce proliferated.
Walmart did not instantly return news channel request for comment. Amazon and JPMorgan declined to comment regarding the matter.
Walmart and Amazon have been looking into FreshDirect for months, based on The Post, who cited a former FreshDirect executive. However, the former executive informed The Post the delay in action is probably going as a result of they’re “waiting for FreshDirect’s valuation to go down further.”
The information comes within the wake of the company having to deal with a barrage of issues stemming from the company’s move from its distribution center in Long Island City to the Bronx.
In September, FreshDirect apologized to customers after being inundated with delivery issues that occurred through the transition, The News reported.
The transition to its Bronx warehouse was supposed to enhance the company’s logistics; however, it did not go “as smooth as planned,” the Journal reported.
Groceries have been slower to migrate online compared to retail goods. Online grocery sales make up 3% of the $800 billion food retail market, based on a recent report by Deutsche Bank. That’s anticipated to climb to 12% by 2025 as services grow, and stores provide extra options, like online ordering for pickup.