Flash-sale website Zulily isn’t finished yet.
Liberty Interactive Corp., parent company of home-shopping service QVC, said Monday that it’s acquiring the struggling Seattle-based e-tailer for $2.4 billion in cash and stock. Liberty will buy all outstanding shares of Zulily at $18.75 each and attribute the purchase to the company’s QVC Group tracking stock.
Five-year-old Zulily, which sells apparel, home goods and footwear at deep discounts for limited-time periods, went public in November 2013. It lowered its 2015 sales forecast in May after experiencing slowed growth and in the past year, shares plummeted 66 percent as many investors questioned the site’s sustainability. But Chinese e-commerce king Alibaba still saw some potential and recently boosted its stake in the mom-oriented seller to 9.3 percent.
Liberty has a good feeling about the online retailer, too. “In Zulily, we see a likeminded brand that shares our passion for discovering great products, for delivering honest value and for building long-term relationships with customers,” Mike George, QVC’s president and CEO who was appointed to Liberty’s executive committee as part of the deal, said in a statement. “Our teams are committed to learning from and inspiring each other and leveraging our platforms in new ways to accelerate growth, serve our customers better and realize the full potential of both of these extraordinary brands.”
Under the proposed transaction, which is expected to close in the fourth quarter, both companies will continue to operate as separate consumer-facing brands. Liberty said QVC will benefit from Zulily’s younger customer demographic and e-commerce capabilities, while Zulily will receive increased exposure.
Zulily President and CEO Darrell Cavens commented, “This combination under Liberty is about investing in our future and providing a tremendous opportunity to accelerate our platform for growth of the Zulily brand through the partnership with QVC.”