Online Market EthnicGrocer Reorganizes, Cuts Staff

CHICAGO (VENTUREWIRE) -- EthnicGrocer, an online marketplace for ethnic foods and products, recipes, and information, said it will change its name and reorganize its business. Under the new corporate name of TransEthnic, the company will create a new subsidiary, Vadia, which will consist of EthnicGrocer's existing technology and infrastructure operations. Vadia will acquire an undisclosed California-based supply chain technology company for about $40 million and the combined entity will provide e-commerce applications, customer service and back-end technology to TransEthnic. Vadia will also sell these services to other retailers and manufacturers. In connection with the acquisition, EthnicGrocer will cut staff by 46 employees, bringing its workforce down to 103. The company says these measures are intended to streamline its operations in order to ensure profitability of its ethnic marketing properties. These include EthnicGrocer.com, Namaste.com for Indian foods, GongShee.com for Chinese foods, and QueRico.com for Hispanic foods. EthnicGrocer said it will apply a less aggressive growth strategy to the Hispanic site, its youngest property, than to the other sites. Backed by Integral Capital Partners, Kleiner Perkins Caufield & Byers, Amerindo Investment Advisors, Merrill Lynch, Benchmark Capital and KB Partners, EthnicGrocer closed a $34-million series C round in August. Kraft Foods also holds an equity stake in the company.

http://www.ethnicgrocer.com
http://www.vadia.com