Wal-Mart buying online retailer newcomer Jet.com

NEW YORK -- Wal-Mart is buying fast-growing online retailer Jet.com for $3 billion in cash plus $300 million in stock, scooping up a newcomer that launched a year ago with the intention of challenging online leader Amazon.

The hefty price underscores how Wal-Mart is trying to compete more effectively for younger and more affluent customers as it has seen its online business growth slow, even with big investments in distribution centers and expanding services.

As part of the deal, Jet.com co-founder and CEO Marc Lore will oversee both that site and walmart.com and will report to Wal-Mart Stores Inc. chief executive Doug McMillon.

Lore brings to the role a rich e-commerce resume as founder of Quidsi, the parent of Diapers.com, which was bought by Amazon for $500 million in 2010.

Analysts say the acquisition won't enable Wal-Mart to catch up to Amazon in sales, but it will help narrow that gap and should widen the distance between Wal-Mart and other online retailers.

The deal also reflects the difficulties for startups such as Jet.com of making it on their own in a sphere Amazon dominates with its network of distribution hubs and its Prime membership program.