APN sells ecommerce business
APN News & Media has sold its struggling brandsExclusive business for A$2 million (NZ$2.2m) and an equity stake in the purchaser, just 18 months after buying it for A$36m.
The publisher of The New Zealand Herald said yesterday that it had signed a contract with Aussie Commerce, following a competitive sale process.
When the sale is completed today, APN will receive $2m in cash and an 8 per cent stake in Aussie Commerce's equity.
The value of the stake has not been disclosed, but Aussie Commerce is profitable with no external debt, and made A$63m of sales in the six months ending December 31.
The fast-growing company has more than three million members and operates seven online shopping brands including The Home, Luxury Escapes and Cudo.
APN had previously said it was looking to divest the loss-making brandsExclusive, as part of a series of asset sales aimed at reducing debt.
It bought the online retailer for A$36m in June 2012, with a further payment of A$30m tied to meeting 2013 earnings targets
APN chief executive Michael Miller said the divestment was the next important step in the media company's ongoing consolidation strategy.
"The Aussie Commerce management team has a strong track record in integrating and growing online businesses," he said.
"Aussie Commerce also provides the necessary scale for brandsExclusive to prosper in the increasingly competitive online retail environment."
Aussie Commerce co-founder and managing director Adam Schwab said the company was excited to join forces with brandsExclusive, which was "a welcome addition" to the portfolio.