Supermarket chain Morrisons has made a statement of e-commerce intent today by announcing the purchase of leading online baby products retailer Kiddicare.com.
In a deal worth £70 million, the grocer will take full control of the multichannel retailer and its technology platform but Kiddicare will continue to trade as a separate company for the time being.
Kiddicare employs 130 people, owns a state-of-the-art freehold distribution centre and operates the largest baby nursery retail store in Europe based in Peterborough, comprising 1,600 sq ft of warehouse, retail and office space.
Dalton Philips, CEO of Morrisons, commented: “This acquisition brings not only a respected, successful and fast growing specialist retailer into the Morrisons group but also a robust, scalable and highly advanced technology platform around which we can begin to build our e-commerce offer.”
The terms of the deal are subject to certain conditions which, if not satisfied by March 23rd 2011, would allow Morrisons to terminate the agreement.
Kiddicare, established in 1974, will continue to be led by current bosses Elaine and Scott Weavers-Wright, and Philips highlighted their “outstanding” experience and track record as being vital to Morrisons building its online business.
Scott Weavers-Wright, CEO of Kiddicare.com, said: “Elaine and I are extremely excited about partnering with Morrisons to accelerate the pace of future growth at kiddicare.com and look forward to working with the Morrisons team to develop their online offer.
“There are fantastic synergies between the two businesses and our platform will allow both brands to enjoy future success and to continue to deliver an unrivalled customer experience.”
Morrisons is already embarking on an expansion of its brick and mortar portfolio having recently bought 16 of the former Netto stores from Asda, as it looks to break into the convenience market.
With this new online strategy Morrisons will be hoping to build on the success of the past few years to challenge the big three supermarkets in the UK, Tesco, Asda and Sainsbury’s.
Nick Bubb, Retail Analyst at Arden Partners, added: “This looks like a good little deal for Morrisons. £70 million seems a relatively modest price to pay for a business with the potential, in terms of management and systems, to get them more heavily involved in non-food online.”