Luxury discount website Gilt City has acquired BuyWithMe.com, a Boston-based site that offers daily deals at local restaurants and retailers.
Financial details of the purchase were not disclosed yesterday.
BuyWithMe said it made a “significant reduction’’ in its workforce last month; although the company did not release figures, it was widely reported that it cut more than 100 employees - over half its staff - after it failed in efforts to win $100 million in new financing. BuyWithMe had been on an acquisition spree, buying more than six companies in the preceding six months.
Nathan Richardson, president of Gilt City, a subsidiary of Gilt Groupe in New York City, said the acquisition will expand the company’s reach where the two sites overlap, and help grow its brand in Boston.
“Their membership list will give us a way to expand and grow,’’ said Richardson, adding that Boston has “a lot of young people whose incomes are rising, and there are a lot of restaurants and services that we think we can marry together.’’
Gilt already had four employees in Boston. They will now work in BuyWithMe’s Back Bay offices, said Richardson. Gilt is hiring 23 employees from BuyWithMe, and offering career assistance to employees who were not offered jobs under the new ownership.
BuyWithMe chief executive Jim Crowley did not return calls for comment.
BuyWithMe launched two years ago in Boston, one of a number of daily deal websites, where consumers find online coupons for local spas, concerts, clothing stores, and restaurants.
Some analysts suggest that the sector is crowded, and this may be leading to consolidation. One report found that there were at least 400 to 500 companies that provide an online discount service, including Groupon and LivingSocial. Boston is also home to other e-retailer sites such Rue La La, which specializes in flash sales of upscale apparel. Last May, Boston.com, The Boston Globe’s free website, added its own digital coupon service called Boston Deals.
“As more and more of these sites continue to evolve, fewer and fewer are getting the traction they like to get,’’ said Marshal Cohen, chief retail industry analyst with The NPD Group in New York. “This whole idea of utilizing the Internet and offering treasure hunt shopping continues to grow, and you will see more and more acquisitions of the bigger guy trying to buy the little guy to gain instant momentum.’’
Sucharita Mulpuru, a retail analyst at Forrester Research, said that “companies like Gilt are looking very aggressively for growth engines, and acquiring the assets of others like e-mail addresses and purchase patterns could be useful to them.’’
Richardson wouldn’t say how many customers subscribe to BuyWithMe. At one point last year, the company had about 90,000 subscribers in the Boston area, and sold 25,000 local deals a month.
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