(Reuters) – Australia’s Woolworths group offered Friday to purchase 80% of MyDeal.com online retail company. This is in an effort to compete with major internet retailers in Australia, including Amazon.com (NASDAQ).

The A$217.4 million ($152.88 million) deal involves Woolworths paying A$1.05 per share of MyDeal — a near 63% premium to the stock’s last close on Thursday. MyDeal shares rose by 57%, and are on track for their most successful day yet.

Woolworths will be able to compete with Amazon and other online retailers in Australia by purchasing MyDeal. It is one of Australia’s most successful internet businesses. Kmart has a rival in Kmart discount department store. Target (NYSE:), stationery vendor Officeworks and hardware chain Bunnings — all selling goods that are also sold on Amazon.

Paul Greenberg (MyDeal chairman) stated in a statement that “the scheme is attractive” and offered an all-cash option. The board of MyDeal also recommended to shareholders that they vote in favor of the takeover.

MyDeal Chief Executive Officer Sean Senvirtne will own almost 60% of Woolworths’ shares. His remaining stake in the company will be held by him.

Barrenjoey analysts wrote in a note, that Woolworths’s acquisition seems to be an implicit acknowledgment of its market failure.

We are puzzled why Woolworths would give capital to non-food business owners.

($1 = 1.4221 Australian dollars)