updated 8/19/2004 4:54:46 PM ET 2004-08-19T20:54:46

Amazon.com Inc. said Thursday it has agreed to buy Joyo.com Ltd., China's largest online retailer of books, music and videos, for $72 million.

Joyo, which was founded in 2000, will become Amazon's seventh global Web site. Amazon said its entry into China will allow it to service the more than 80 million consumers already online there.

Joyo, incorporated in the British Virgin Islands, operates the Joyo.com Web sites in cooperation with Chinese subsidiaries and affiliates.

Amazon was reported to have made a takeover bid for Joyo rival DangDang.com. Executives at DangDang earlier this month rejected an offer of up to $1 billion after six months of negotiations.

Under the agreement with Joyo.com, Seattle-based Internet retailing giant Amazon will also assume employee stock options worth about $3 million.

The transaction is expected to close in the third quarter. Amazon said the acquisition shouldn't have a significant impact on net sales or operating profit this fiscal year.

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