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Yell Acquires MoonfruitProvider of Digital Commerce Tools to Local Businesses (May 16, 2012)
SAN FRANCISCO, CA -- (Marketwire) -- 05/16/12 -- 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 UK's leading DIY website and online shop builder. The total cash consideration for the acquisition is approximately $28.8 million, funded out of Yell's cash reserves. Retention bonuses of up to $8.3 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 Yell's 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 -- "light" -- commerce services to millions of SMEs.
The deal complements Yell's 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 "light" 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 Moonfruit's platform. The deal accelerates Moonfruit's own expansion worldwide, building on its rapid growth in the UK and US.
Mike Pocock, Chief Executive Officer of Yell, said: "We believe there are significant strategic, cultural and operating synergies between Yell and Moonfruit. The addition of Moonfruit's services and team helps us provide competitive advantage to our global SME customers in connecting with consumers through digital, mobile and social."
Moonfruit's 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 Moonfruit's 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: "We 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."
Moonfruit took $2.4 million in funding in 2010 from investors Stephens(US) and Silicon Valley based angels -- Dave McClure 500 Startups, Robbie Van-Adibe and Theorem.
About the transaction
The total cash consideration for the acquisition is approximately £18 million.
The value of the assets, which are the subject of the transaction, as reflected on Moonfruit's balance sheet as at 31 December 2011, is £4.88 million. For the year ended 31 December 2011, Sitemaker Software Limited, Moonfruit's wholly-owned subsidiary, made a loss before tax of £1.26 million.
The acquisition will be through a recommended cash offer (the "Offer") by Yell Limited, a wholly owned UK subsidiary of Yell, for the entire issued, and to be issued, share capital of Moonfruit. The offer is conditional upon Yell Limited receiving acceptances to the offer in respect of 100 per cent of Moonfruit shares, although this condition may be waived by Yell Limited. Yell Limited has received irrevocable undertakings to accept or procure acceptance of the Offer in respect of an aggregate of 13,761,529 Moonfruit shares representing approximately 90 per cent of the current issued share capital of Moonfruit.
Moonfruit's executive management team of Joe White, Eirik Pettersen and Wendy Tan-White have agreed to give warranties relating to Moonfruit's business. In addition, they will enter into new service contracts with Yell Limited, conditional upon and subject to the offer becoming unconditional in all respects.
Yell Group is a leading provider of digital services within the emerging local eMarketplace for consumers and SMEs across its operations in the UK, US, Spain and some countries in Latin America.
Building on its strong presence in the local market through its current digital and print portfolio, Yell is developing a broad range of digital services tailored to the converging needs of SMEs and consumers.
These address both the SMEs' need to grow, transact and be efficient in the digital world, and the consumers' need to connect locally to the goods and services they want, in a way which saves them time and money, and moves their lives forward.
In the year ended 31 March 2011, Yell Group had 1.3 million SME customers.
For more information, visit www.yellgroup.com
Moonfruit is a high design DIY website and shop builder with the aim to democratize the web for small businesses and individuals by providing easy-to-use web design and shop-building tools.
Moonfruit enables personalized web design, instant e-commerce across different channels including social and mobile, as well as market place distribution, for anyone. Moonfruit lets you customize the style and layout of your site so that it reflects your brand without having to understand any coding. Web sites are SEO-friendly and immediately optimized for web and mobile.
The Moonfruit ShopBuilder gives you the power to set up your online shop and trade immediately and everywhere, through the global channels of the web, mobile and social media. Over 5 million sites and 230,000 shops have been built using Moonfruit. It is the no. 1 hosted site builder in the UK and is expanding rapidly across the world, with over 1.5 million sites built in the US, visit http://www.moonfruit.com
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