SmarterKids.com, Earlychildhood finalize merger
Online retailer SmarterKids.com Inc. has merged with Earlychildhood LLC, a retailer of educational products to teachers and parents, to form LearningStar Corp. Both SmarterKids.com and Earlychildhood became wholly-owned subsidiaries of LearningStar. Shares of SmarterKids ceased trading on the NASDAQ Monday. New shares fo LearningStar started trading today. Ronald Elliott became chief executive officer and Al Noyes became chairman of the board of LearningStar.
LearningStar becomes a developer, manufacturer, and retailer of educational products, targeting teachers and parents with products for children from infancy to age 12. LearningStar has secured a $25 million credit facility with GMAC Business Credit that it intends to use to grow its business and secure its position in the educational and e-commerce sectors.
Among developments as a result of the merger:
-- SmarterKids.com has reduced its staff by 60%, and currently employs 45 individuals.
--SmarterKids.com has transitioned its entire fulfillment operation from Mansfield, Massachusetts to Earlychildhood`s warehouse system.
--SmarterKids.com has successfully leased its Mansfield Distribution Center facility to a third party.
-- SmarterKids.com`s customer service inquiries are now handled by Earlychildhood`s West Coast Call Center.
-- SmarterKids.com now offers selections from the Earlychildhood product mix, including proprietary and other items that were previously unavailable direct to consumers.
--LearningStar presently anticipates 2001 consolidated revenue growth to exceed 15% over 2000 revenues of $90.6 million.
"LearningStar will create significant value by realizing the substantial economies made possible by this combination and by positioning itself for future growth,” Elliott said. “The convergence of retail expertise, superior products, complementary channels, and technology know-how, forms a company with both B-to-B and B-to-C leadership and a healthy bottom line." Elliott was CEO of Earlychildhood.
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