$2.4B deal for Zulily: Liberty Interactive Zulily

Published: August 17, 2015

$2.4B deal for Zulily: Liberty Interactive Zulily, The Liberty Interactive Corporation said on Monday that it had agreed to acquire Zulily in a cash-and-stock deal that values the online retailer at $2.4 billion.

The transaction is expected to bolster Liberty’s QVC Group business, which includes its online and broadcast shopping channel QVC and its interest in the retail and interactive lifestyle broadcast network HSN.

The acquisition will be reflected in the QVC tracking stock, Liberty said.

Following the deal, QVC and Zulily will operate as separate brands, but are expected to collaborate on sales and strategy.

Under the terms of the deal, Liberty, based in Englewood, Colo., will pay the equivalent of $18.75 a share for Zulily, representing a 49 percent premium to Zulily’s closing price on Friday.

“We are excited for Zulily to join the Liberty family,” Gregory B. Maffei, the Liberty Interactive president and chief executive, said in a news release.

“Combined under Liberty, we have an incredible opportunity to delight shoppers from the TV to the Internet,” he added.

Founded in 2010, Zulily is an online retailer focused on young families offering a variety of products, including clothing, shoes, home d├ęcor and toys. Zulily, based in Seattle, reported sales of $1.2 billion in 2014.

Zulily is known for its “flash sales” – heavily discounted, limited-time deals intended to pry open cautions shoppers’ wallets. But flash sale sites are starting to lose their luster as consumers seemingly become desensitized to daily deals. Sales at the biggest flash sale sites, including Gilt, Rue La La and Zulily, have stalled in recent quarters.

QVC, meanwhile, is moving aggressively online, and roughly half of its sales in the United States come from its website. But online, QVC has faced formidable competitors like Amazon, and the company had been looking to bolster its web presence.

Liberty’s acquisition of Zulily comes less than two years after it went public.

The transaction, which requires regulatory approval, has been approved by the boards of directors of both companies and is expected to close in the fourth quarter.


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