Amazon reportedly in talks to buy Brazilian bookseller Saraiva

PanARMENIAN.Net - Amazon.com Inc., the world’s largest online retailer, is in talks to buy Saraiva SA Livreiros Editores, a Brazilian bookseller, Bloomberg reported citing a person with direct knowledge of the matter.

The person asked not to be identified because the discussions are private. Saraiva, based in Sao Paulo, publishes books and sells them on the Internet and through a store chain.

Amazon Chief Executive Officer Jeff Bezos would use the deal to broaden the company’s base in Brazil, Latin America’s largest economy. The retailer is looking for new areas of growth as stepped-up spending on areas such as its Kindle e-reader and fulfillment centers erodes profitability.

Drew Herdener, a spokesman for Seattle-based Amazon, declined to comment. Saraiva Chief Financial Officer Joao Luis Ramos Hopp said the company doesn’t comment on market rumors.

Exame magazine reported in August that Saraiva was among the possible acquisition targets for Amazon in Brazil. The Sao Paulo-based publication didn’t cite how it obtained the information. Brazil’s online retail sales will expand 20 percent to 22.5 billion reais this year from 2011, consulting company E-bit said in August. The industry posted a 21 percent expansion in the first half of this year compared with the same period of 2011, E-bit said.

Saraiva’s publishing business will increase its digital sales in coming years as Brazil’s government plans to start buying digital books in 2014, Marcio Osako and Fernando Labes, analysts at Banco J. Safra SA in Sao Paulo, wrote in a note to clients on Oct 2.

“It represents both an increase in revenues and it may further consolidate the market,” the analysts wrote, saying that Saraiva has about a 19 percent share of Brazil’s government textbook purchases. “The top four have about 80 percent market share.”

Saraiva’s net sales rose to 341.5 million reais in the second quarter, up 4.4 percent from a year earlier. The online business contributed 103.7 million reais, according to the company’s earnings statement.