Moonpig Group proposes to acquire Smartbox Group UK for £124mn

Moonpig Group proposes to acquire Smartbox Group UK for £124mn

LONDON, UK: Moonpig Group, the leading online greeting card and gifting platform in the UK and the Netherlands, announced the proposed acquisition of the entire issued share capital of Smartbox Group UK Limited, the UK’s leading gift experiences platform, for cash consideration of £124 million.

Moonpig Group CEO Nickyl Raithatha commented: “The proposed acquisition of Buyagift rapidly accelerates Moonpig Group’s journey to become the ultimate gifting companion. There is strong strategic rationale for the transaction, and compelling financial benefits.

Buyagift is profitable and highly cash generative, with a proven track record of strong growth and we are excited by the ways that we can further transform the business using the Group’s proven playbook. We see significant potential for the cross-selling of gifting experiences to Moonpig Group’s loyal customers. We look forward to working with the Buyagift team to deliver an enhanced proposition for our customers and to create value for our shareholders.”

The combination of Moonpig Group and Buyagift will accelerate the Group’s strategy to become the ultimate gifting companion.

The Acquisition unlocks the £6 billion UK gift experiences segment of the £57 billion total addressable gifting market. The experiences segment is growing at a faster rate than total gifting as a result of the secular consumer trend towards experiential gifts such as days out, meals and activities rather than physical gifts.

Within this segment, specialist gift experiences platforms such as Buyagift have consistently increased their market share by providing superior choice, flexibility and assurance of quality to consumers across the UK. As the leading platform in a large and fragmented market, Buyagift is well positioned to accelerate market share gains within the growing experience gift market.

Buyagift’s portfolio of gift experiences will deliver an instant step-change to the breadth and relevance of Moonpig Group’s range without requiring additional inventory. It will enable us to combine the Group’s proprietary dataset on gifting intent with an expanded offering to produce highly relevant gifting recommendations as well as allowing us to leverage location-based data relating to recipients.

The outcome is that Moonpig Group will be able to recommend specific and bespoke gift experiences to approximately 13 million loyal customers every time they shop with us.

The proposed Acquisition will enable digital delivery of gifts on Moonpig Group’s technology platform. This includes both the opportunity to “make the greeting card the gift” through gift vouchers printed within the card, and unlocks the same-day gifting market through embedding the gift experience in an e-card delivered instantly.

“We remain confident in our existing expectations for Group trading in FY23. Based on the anticipated completion of the Acquisition by the end of July 2022, we now expect revenue for the enlarged Moonpig Group in FY23 to be approximately £350 million.

In the medium-term, we expect to accelerate the revenue growth of Buyagift, and continue to target mid-teens percentage underlying revenue growth for the enlarged Group.

The proposed Acquisition is expected to be margin accretive, in view of which we are raising the Group’s medium-term Adjusted EBITDA margin rate target to between approximately 25.0% and 26.0%,” a statement said.

www.moonpig.group

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