QVC parent Liberty to acquire Zulily

On August 17, 2015, the Company announced that its Board of Directors approved a definitive merger agreement for Liberty Interactive to acquire ZU in a cash-and-stock transaction valued at $2.4 billion.

Additionally, QVC will benefit from Zulily’s younger customer demographic, personalization expertise and e-commerce capabilities.

Before the recent acquisition, Zulily received a $150 million stake from Chinese company Alibaba in May.

Billionaire John Malone-backed Liberty will combine the five-year old Zulily with its QVC business, which is about 30 years old and seen by analysts as a maturing business in the United States. The company is also one of a handful of retailers that has exceeded the $1 billion annual earning mark.

QVC has been expanding its digital presence – 40 percent of its revenue comes from e-commerce.

Under the terms of the transaction, Zulily shareholders will receive $18.75 per share, which consists of $9.375 in cash and 0.3098 in newly issued Liberty stock for each share of Zulily they own.

Zulily has been struggling to boost growth in the face of increasing competition from other flash sales sites such as Boston-based Rue La La and giants such as Amazon.com Inc (AMZN.O).

Chief executive at research firm Conlumino, Neil Saunders said that some work is required to get Zulily back on growth track.

“As the world leader in video and eCommerce retail, QVC is dedicated to reimagining shopping, entertainment and community as one”, said Mike George, president and CEO of QVC.

Zulily (): Liberty Interactive’s cope with Zulily, which gives members flash gross sales on clothes, toys, and different merchandise, is predicted to be accomplished within the final quarter of the yr. Liberty says the deal shall be mutually useful as QVC will profit from Zulily’s youthful buyer viewers, whereas the web retailer will recieve elevated TV publicity by way of QVC.

Liberty has hired Baker Botts LLP as a legal adviser. Goldman Sachs is the financial adviser to Zulily and Weil, Gotshal & Manges LLP and Cooley LLP are its legal advisers.