Private investment firm Comvest Partners acquires the financially troubled e-retailer, which filed for Chapter 11 bankruptcy protection in March.
The deal is a significant move in Yell¹s ongoing transformation from its established position in providing print and online advertising for small and medium-sized enterprises (SMEs) to become a leader in the emerging local eMarketplace.
Yell, a leading provider of digital services, today announces a further important step in its creation of the local eMarketplace with the acquisition of Moonfruit Limited ("Moonfruit"), the UK¹s leading DIY website and online shop builder. The total cash consideration for the acquisition is approximately £18 million, funded out of Yell¹s cash reserves. Retention bonuses of up to £5.2 million will be paid to key Moonfruit management after two years, provided that they remain exclusively employed by Yell.
The deal is a significant move in Yell¹s ongoing transformation from its established position in providing print and online advertising for small and medium-sized enterprises (SMEs) to become a leader in the emerging local eMarketplace. The eMarketplace comprises an innovative platform and digital portal where consumers and SMEs can connect and transact. This acquisition helps Yell secure the foundations for this strategy by significantly enhancing its ability to provide cutting edge websites, mobile sites and simple - ³light² - commerce services to millions of SMEs.
The deal complements Yell¹s acquisition of multi-store ecommerce leader Znode last year. While Znode technology is providing SMEs with enterprise opportunities through its ecommerce platform, Moonfruit offers them ³light² commerce, and the opportunity to enhance their presence online, on mobile and on social. This makes the eMarketplace more accessible to more merchants, so enhancing the consumer experience.
The deal provides Yell with potential future cost efficiencies and enhanced capability in areas such as website construction, proofing and editing, reflecting the calibre of Moonfruit¹s platform. The deal accelerates Moonfruit¹s own expansion worldwide, building on its rapid growth in the UK and US.
Mike Pocock, Chief Executive Officer of Yell, said: ³We believe there are significant strategic, cultural and operating synergies between Yell and Moonfruit. The addition of Moonfruit¹s services and team helps us provide competitive advantage to our global SME customers in connecting with consumers through digital, mobile and social.²
Moonfruit¹s website Moonfruit.com was launched in the UK in 2000 with a mission to make the web easily accessible for local businesses and consumers. When a customer builds a Moonfruit site, with a click of a button they can add a commerce option, a mobile presence and build a Facebook store, all from the same platform.
Nearly five million websites and 230,000 online shops, mainly in the UK and US, have been created using Moonfruit.com technology. Updated HTML5 versions of their sites that build on their existing HTML5 mobile and Facebook versions will be launched later this year.
Yell is acquiring Moonfruit¹s innovative technology as well as its high calibre technical and design teams. Moonfruit.com will remain a sub-brand.
Moonfruit co-founders Chief Executive Officer Wendy Tan-White, Chief Operating Officer Joe White and Chief Technology Officer Eirik Pettersen will take senior roles in Yell Group. Wendy Tan-White and Joe White will report directly to Scott Moore, who joined Yell last December in the new global role of Chief Digital Officer. Scott was previously Partner and Executive Producer at MSN, having held senior roles at Yahoo! and Microsoft businesses.
Wendy Tan-White, Founder and Chief Executive Officer of Moonfruit, said: ³We built Moonfruit to make it easy to publish and sell on the internet, and provide stylish web, blog and shop designs as well as easy-to-use web tools for SMEs. Joining Yell and integrating with its local eMarketplace provides access to larger audiences and additional resource to accelerate what is a common vision for the future.²
Moonfruit took £1.57 million in funding in 2010 from investors Stephens(US) and Silicon Valley based angels Dave McClure 500 Startups, Robbie Van-Adibe and Theorem.